Before you start investing and building capital, you need to draw up a personal financial plan. This document should spell out the financial goal that you plan to achieve after a certain period of time.
Instructions
Step 1
It is very important to correctly formulate the goal, it is not easy, because 90% of people have no idea what they are striving for financially. Only by knowing the purpose of turning to investment will you place your money correctly.
Step 2
As a rule, the most common financial goals are: the acquisition of real estate, the education of children, the accumulation of funds for retirement. It should be noted that the financial plan can change over time. The reason is the addition of new financial targets.
Step 3
In order to determine how the financial goal is achievable, make calculations. Put your personal finances in order - assess assets and liabilities, see how much income the assets bring.
Step 4
The correct assignment of a thing to assets or liabilities is the key to a successful assessment. For example, a closed old apartment in which you do not live is classified as a liability. And this is despite the fact that, theoretically, it increases in value. So, for an apartment you have to pay monthly rent, spend money, which only increases costs.
Step 5
But, if you start renting out an apartment, it will become an asset. It will not only grow in value, but also generate monthly income that covers the cost of maintaining the housing. Thus, you should strive to ensure that assets prevail over liabilities.
Step 6
It is also worth reconsidering the attitude towards loans. Debts can be conditionally attributed to good - when they go to business development, or bad. Most of the loans taken out are bad debts, which only drag the family down. Such loans should be disposed of. Better to focus on your money, rather than borrowed funds. Then you will create capital faster.
Step 7
The next step is to determine the amount that you can spend on investment on a monthly basis painlessly for the family budget.
Step 8
Determine the risks that you are willing to take when investing. The main ones include market and currency risks. Market risk does not include bank or company failures. Such risk is understood only as the market fluctuation of the financial instrument you use when investing.
Step 9
So, when investing aggressively, assets must be prepared for the fact that assets may fall in price by 15% or more. But the profit in the long term for such instruments is much higher than that of conservative instruments. However, it is better to choose a more conservative strategy, and place only part of the funds in aggressive instruments. It is better to choose the preservation of money as a priority, rather than its rapid increase.
Step 10
Make financial calculations, write down the result on paper. If you are unsure where to invest to build capital, contact a financial advisor. Just choose an experienced specialist who has certificates. The consultant's reputation must be impeccable.
