Browse Tag: money

A penny saved is more than a penny earned

“A penny saved is a penny earned”

Most of us would have heard this popular saying. In reality, it is different. Is goes like this

“A penny saved is more than a penny earned”. Yes it is more, much more than you think. There are different angles to it.

If you see from taxation point of view, the penny saved is after tax deduction. That means you have already paid the tax on the saved penny. When you earn a penny, you have to pay tax. And for the highest tax bracket, its 33% tax, so when you earn one penny, you end up having only 0.67 penny at your disposal.

If you see from Work angle, you have already put in effort to earn the saved penny. You had worked x amount of time and put in your energy and earned the saved penny. To earn a penny again you have to put x amount of time, energy and resources in terms of fuel etc for commuting.

Hence you are much better off when you save a penny. Save it and invest it so that you can multiply it for your future needs.

Framework to bring finances under control

Taking control of your financial life is not very complicated, nothing like rocket science. The basic principals are simple, easy to practice if you can co-relate them with your day to day life and the expenses you incur.

  • Get a good education, work towards building your career
  • Spend less than you earn – This is the most important part
  • Track & budget your expenses – Any given point of time, you should know where you are financially
  • Invest diligently rather religiously every month towards your goals
  • Plan for taxes; take informed decisions on your regular taxes and taxes on your investments. Optimize them so that you do not end up paying a lot to the government
  • Keep enhancing knowledge to manage investments, budget and taxes. Remember, it’s your money and none else will help you in planning for your goals unless they have vested interests

The above 6 points sums up the key to financial success. And remember, there is no place for debt which can spoil any good retirement plan. Especially the debt meant for buying lifestyle goods. You need to beat inflation as well as lifestyle inflation to beat the financial blues

Your money is your money!

As title says, “your money is your money“. None other than you would be able to manage it better. Others, who claim they can manage better, have their conflict of interest since they would be doing it for their livelihood. When they earn commissions for suggesting you the investment tools, they can never be honest with you. Here I am talking about the insurance agents, investment advisers and host of bank officials who always push you with some “REAL GOOD” plans

I am not pointing fingers at the financial planners, but at times, they cannot be believed due to conflict of interest clause. Their “BEST PLAN” might be the “BEST PLAN” for themselves but may not suit your needs.

A common man, who is working his way up in his career, is an educated person. He has basic knowledge of this world, how to live, survive, commute, plan things. Why not take charge of the finances instead of outsourcing it to someone who is unlikely to give you honest advice. We as employee help our companies to grow by managing their balance sheets, why not help ourselves by managing our own balance sheet of household finances & investments?

So remember, your money is your money. If you outsource your money management to someone, he will be more interested in sucking the commissions out of you by suggesting funds/avenues which gives him better commissions instead of suggesting you honestly where to invest. So take charge, control your finances. And believe me, with little knowledge you can be easily at the driver seat.

You alone will be the best person to guide your investments which is ultimately going to lead you to a financially stable retired life.

Why Money is Important?

A popular advert for a leading credit card company says “There are some things money can’t buy, for others there is MXXXXXCard”

Philosophically it can be said that money is not the most important thing in this world, but the fact is that without money, none can survive. We need money to buy food, buy a roof at our head, buy services to sustain our life/lifestyle and above all it gives us a kind of security.

  • When you are a student, you need money to fund education
  • When you start working, you need money to buy basic necessities
  • When you are married, and have family, you need money to build wealth and buy comforts
  • When you are sick, you need money for the healthcare
  • When you retire from work, you need money to sustain your lifestyle and fund expenses
  • When you are dead, you need money for your last rites

 

Money is required for every single stage of your life. We live in a world that thrives on Money. We don’t see this trend passing / changing anytime soon. The best thing is to use money as a tool, a mere tool so attain happiness. Not in terms of buying all luxuries available out there but to make wise decisions to have happiness and spread happiness in life of people who are connected with us.

Money is important but it’s also JUST money. Of course we should study hard, work hard to earn money but at the same time we must not lose our sleep over money. We should strive for a balanced life where you stop and smell the roses at will.
Wealthsamurai is about living life being lively, not about running around scouring for money all the time. We must focus on living a quality life instead of measuring our life by quantity of stuff we buy