Building Wealth by Paying Yourself First
When I look around at all of my friends, and a lot of my family, I see a lot of people living from pay check to pay check, under monetary stress. These same people watch the Calendar for payday like a hawk. Pay their bills, and then open up the spending flood gates, before they know it, they are itching for their next pay check. These same people are the people who don't think they make enough money to build future wealth. They are wrong.
The way I save money, is by paying myself first. I have automatic deductions come out of my bank account on the 15th and 30th of every month, which I put directly into a mutual fund for safe keeping. I take a small portion of my pay check, roughly 10% and put it away. This may not seem like much, but over time it adds up.
In addition, with mutual funds you will have the benefit of compound interest on your side. You should EASILY be able to achieve 8% interest on average in a good a mutual fund, often times more. That’s $800 a year on $10000!
Once you start, you will be addicted. Watching your funds grow is incredibly addictive and will inspire you to invest a larger percentage as your income rises. If you have debt, put a portion of this percentage towards the debt and a portion into your mutual fund, so you have something positive to reinforce your automatic deductions.
How to Evaluate Stocks Picks for Better Prospects?
Internet is filled with stock picks websites. They are powerful investing tools. They can help you improve your investments results if you know how to use them. If you are well informed and want to add some stock picks to your investments portfolio, here are a few suggestions:
First, analyse all stock picks you want to trade
In the name of hygienic wisdom, you should clean fruits you pick from the farm before eating them. Similarly, in the name of common sense you should evaluate stocks you get from stock picks sites before trading them. The problem is to find a better prospect from the daily stock picks is difficult. It requires time, discipline and knowledge of stock market.
Money Growth Can Be Substantial
Over the last twenty years, mutual funds have become quite popular with more than 80 million individuals investing in them. Investing in them gives everyone the opportunity to get their share of the market, and if they deliver, money growth can be substantial.
Mutual funds that focus on large, fast-growing companies that have high revenue growth earnings and do not pay dividends, but are making significant earnings are called 'growth funds'. Growth mutual fund managers will take risks and pay more for stocks in order to construct a portfolio of those companies that have above average earnings consistently and/or price appreciation. These funds can be and often times are more vulnerable to rises and falls than other mutual funds. When a market is on the downside, a manager must be aggressive to make up for the loss or a lot of money will go down the drain.