These Will Only Give Back A Small Amount Of Interest

Category: Finance, Financial Planning.

Few families pass on actual knowledge about wealth building to their children.

Accountant and financial advisor, Dr. Negative feelings of poverty and scarcity can last for generations. Joseph Simini says, "Most people are illiterate about finance. If you want to become financially independent, you can t depend on someone else to do that for you. Finance isn t all that tough. You have to do it yourself with knowledge. " Dr.

He manages family owned investments and advises people on the subject of financial independence. Simini started out in life in a poor immigrant family and learned the basics of creating personal wealth from his father s teachings and the school of hard knocks. He offers practical advice on how to become financially literate and financially independent: Buy Your Own Home: It is important to buy your own home because with a small amount of money, and a lot of someone else s money, you can get started. Eventually, you are going to own the building, leading to tax benefits. Instead of paying rent and making your landlord wealthy, you will be paying into your own mortgage. Deduct Property Taxes and Mortgage Interest: These items can be deducted from your regular income and that is a big savings. Save 10 Percent of Your Income: Fill out a budget categorizing all your bills and when they should be paid.

Most people just use their standard deduction, but by adding the property tax deduction and the mortgage interest deduction, you can increase your deduction by thousands of dollars. At the top of the list of bills to be paid, put your own name. Nobody can help you, but you. Pay yourself first. Make a List of Necessities: Make a list of the necessities that you need to live: rent, clothes, mortgage, food, etc. Decide if you really need all the things you are spending your money on.

After this, make a list of the discretionary things. Are they necessary? These are the financial questions you need to answer. Can you cut back? Take Advantage of Compound Interest: One of the most important fundamentals of wealth building is compound interest. Compound interest is the interest added to the principle, and then the interest rate is on the new amount of money. Instead of giving you a nice return, compound interest will give you a sensational return.

Each year it becomes a little more. All of these wealth building strategies require awareness and a change in habits. After years of compounding interest, it becomes a tremendously larger amount of money than if it were only simple interest. Change your attitude about money. Read financial magazines, the business section of the paper, and financial magazines. Change your financial habits.

Know what money can do for you. Put your skills and talents to work for you. Look beyond just employment income. Create additional streams of income teaching or selling the hobbies you are already interested in. You have to go out and build income of your own. This additional income will give more opportunities for saving and paying the bills.

Avoid putting your money into cash. These will only give back a small amount of interest. That includes: a bank account, and bonds, notes. They are the worst things to invest in. Do your homework, researching all the information available about investing in stocks. The stock market has the potential for incredible wealth building if you learn the rules of the game. Become stock literate to protect your investment in the stock market.

Do not get caught up in limited thinking. Find advisors and take responsibility for your own choices about your own money. Expand a little bit and take some different actions to benefit yourself financially. Get yourself started onto the road of financial success by becoming financially literate. This is the foundation of building financial independence. Once you learn the financial principles and practices pass them on to your children. Knowing about money is as important as knowing the ABC s in today s world.

Get your children involved in the basic skills of finances and building wealth. Financial literacy will lead you to additional wealth building techniques. You will be able to come up with a plan that will take you from paying someone else, to becoming the person who other people are paying.