Your money should make money

The mechanisms of the financial management of the enterprise is more or less clear. Above this structure employs a dedicated person, or even a whole department or even a department consisting of accounting, treasury, planning and economic department, etc. With personal finances accustomed to in a simple way:

how many there are in your wallet, and there are many. And a little more in the bedside table. Know how much in your wallet - it is, therefore, financial accounting. Regularly set aside in the locker - management in its purest form.

You can even try a fancy "chips" - to talk money, so that they floated into the hands.

In the morning before work to represent himself standing under an avalanche of cash flow. Carefully listen to monetary intuition, reinforcing its oracles crystal ball. All this - the different series of Brazilian soap opera or Slavic fairy tales "by magic."

They are created by various myth-makers with one goal: for your specific money to meet your specific desire - to earn as much as possible with the least effort.

In our case, we will talk about how to manage personal finances pragmatic and robust economic methods, with the help of the brain and through their proper use.

And during your vacation? And the children to university?

To manage finances, need to know their basic laws and principles of motion describing their formulas, as well as the laws of the country, the financial instruments that you want to use. During the management of personal (and corporate) finance, it is important not only set yourself up to make money and earn them (or get as you like).

This is only a third of cases. Two-thirds - the ability to dispose of funds and make them work for you. What is there management, you ask, when you need to pay immediately to report it to hold, and even go on vacation and the children to the university? Deep misconception occurs because of ignorance of financial laws.

All just the opposite: a lot of money or a little, but the mechanisms of management are absolutely identical. The bottom line is that any amount being properly and effectively managed, in a good case, not squandered, and ideally - will bring extra income.

Unpopular TRUTH ABOUT MONEY

I venture to offer you some seditious thoughts about money management. Thought one: and corporate and personal finances to manage profitable from the standpoint of the economy, rather than increase income.

Simple mathematics (second seditious proposal: math we do not like, but in vain): Say you earn 1000 UAH. (or dollars, of your choice) per month, of which 850 UAH. spend, and 150 UAH. set aside. I would like to lay their amount increased by 50 units.

Variants of execution of this desire, there are two: to reduce costs from 850 UAH. up to 800 UAH. (5, 9%), or to increase its income from 1000 UAH. up to 1333, UAH 3. (33%). Here's a mystic. It should be noted that the figures in financial management - irreplaceable thing. Management itself consists of planning, analysis, control and accounting of finances, investments and taxes.

Try to get things done without numbers and calculations! Savings in the order of personal money does not mean that it is not necessary to raise revenue. Rather, it is possible and necessary. But if management is implemented at least the minimum amount, source of extra growth will not necessarily be an increase in employment, and hence earnings. On closer inspection, internal resources are always needed only properly dispose of them. We must start with the reduction of inefficient spending.

In a detailed analysis of their own cash costs in almost all found some set of standard luxuries - emotional purchases, of which about 40% are absolutely not necessary, except for the dubious pleasure in the first 5 minutes, during and after your purchase; - Inattention to spending up to $ 100 USD. (or dollars) - psychological properties of numbers; - The status of purchase, as a rule, is also very questionable character; - The purchase of the future, that is often a psychological protection against insecurity; - Purchases under the influence of advertising.

These features of the behavior of buyers is very well understood by professional sellers. Without becoming a professional buyer, you will pay for your continuously amateur approach to the matter of his own pocket.

RESERVES

After a thorough analysis of its expenses, including detailed accounting method (preferably - written on it and the account), you get to decide the next important task of contributing to the global goal of financial management. It is about creating a protective provision for force majeure, as well as to activate the normal ongoing operations.

In corporate finance is called maintaining the current liquidity of the enterprise and long-term financial sustainability. Thus companies are protected from volatile external environment. With the personal finance business are exactly the same, only much closer to the body.

In the case of force majeure should be to create a reserve for the protection of the health and performance, for the protection of children, family and loved ones at home if the health and performance are lost (unfortunately, in this case, time is not in our favor), or source of income is not stable.

Healthcare money can not buy, but the price of medicines and treatment is known, and therefore form a reserve for the protection of the health and performance you need. In addition, as it does not sound awful, but be much more disabled than to die, because in the second end and revenues and expenses, and in the first - expenses also increased.

The future of your children should not be dependent on your sad this (if you suddenly can not work). For the same situation, and care must be taken to protect your property.

All these problems are usually solved with the help of insurance, the corresponding legal registration and retirement planning. Modern insurance companies offer enough about Schirn list of products for each of the above cases. Buying these products also need to be a professional buyer.

"Beautiful far, do not be cruel to me ..."

Another direction of the formation of the reserve - increase the financial base. In the preceding paragraph spoke of putting money aside for a rainy day, now it is a question of adjournment today and a brighter future, in other words - of the reserve funds to all that lay the foundation financially stable life.

About the money and financial literacy

A huge ball of inadequate facilities humanity related to the topic of money. Not all of them are directly related to psychology - to understand them would have to explain the basics of financial management, but that's another topic. However, about one of inadequate facilities associated with money, today we talk here and now.

Its aphoristic expression, though belongs to Karl Marx, but our people more aware thanks to Ostap Bender, otcherknuvshego her blue pencil in the book "Sharks of world imperialism", sent by post to Alexander Koreiko.

Remembered?

"All of the major modern state amassed the most dishonest way"

Koreiko was an exceptional man. Instantly he multiplied and divided in the mind of the big three-digit and four-digit numbers. He looked like a boxer, prudently prepares his triumph. He submitted a special regime, and did not drink or smoke, keep in shape, doing heavy weights.

Alexander wanted to be young and fresh that day, when all return to the old, and he will come out of hiding, fearlessly reveal their ordinary suitcase. The fact that the old will return Koreiko never doubted. He's saving himself for capitalism.

Judging by the fact that in those early years, Alexander Ivanovich was already thirty-eight, capitalism, he is not likely to wait. They waited for us.

Settings people are replaced more slowly than economic formations.

According to the surveys of sociologists, 80% of respondents in Russia believe that wealth and honesty are incompatible. On the question of the capitalist world "If you're so smart, why are so poor," our people have come up with Throws capitalists surprise answer: "It's because honest!"

Ask people why they think so, and they are unlikely to be able to answer you anything other than, "Well, that's all we know."

And even the most advanced lead in response to a quote from Karl Marx, which forced Alexander Ivanovich grimaced in horror.

Why Ilf and Petrov moved Marx in the mass installation - understandable. The time is there. And you now what it is?

I am sure that if social scientists ask the question "Would you like to be rich?", The majority of respondents answered "yes." By the way, you also want? At the same time, over 80% of people believe that wealth and honesty are incompatible. By the way, you also believe?

If you both questions answered "yes", then obviously you're going to achieve wealth through dishonest?

If not, then you are not yet obvious that the installation of "wealth and honesty are incompatible" and the desire to be honest it is impossible to become rich?

In general, what is money?

Man seriously exist apart from the others, not taking advantage of the fruits of their labor. Ie There, he can. (See, eg, R. Kipling "Mowgli" or V.Megre "Anastasia"), but it was too (in my subjective opinion) is not comfortable.

To make life more comfortable, people began to use the division of labor - one does one thing and another - another. Then share the results. You told me the goat - I told you the boat.

But barter is not too convenient, and people have come up with the money.

Money - is the equivalent of the value of goods and services. Let me remind you - goods and services - is the fruit of the labor of people is the benefit that they can bring to other members of society.

Money - a measure of the benefits that you bring to others.

Like this.

The money you receive for their work for the benefit of others, reflect two things:

As far as what you do really need other people (there are a lot of different components - for example, how your work is unique and irreplaceable, etc.)

How much do you know how to present and sell the results of their work to others.

However, the benefit to society can not only bring you personally by their own labor, but before you earn the money themselves. I'm talking about investing. Investing free savings you time on your money transfer business, which uses them to make a profit by producing the right products or providing useful services.

The benefit of all this:

and a business that is able to scale up and make additional profits

and society are gaining new products and services

and you, as an additional passive income, for which it is not necessary to work - interest, dividends, etc.

It is interesting that your money is being properly and wisely invested, can eventually start bringing you a lot more revenue than a private employment.

However, in order to invest correctly and wisely, and really get the passive income (instead of losing them in the next financial gamble) need financial literacy.

The problem with most of our fellow citizens is that they do not have the financial literacy. It is not taught in schools and colleges. Despite the abundance of books in bookstores, I can not recommend any of them as a good tutorial on what actually represent a investment, and how to actually operate the financial markets.

The same book by Robert Kiyosaki in a series of "Rich Dad, Poor Dad", which prompted many interested in investing (and which I recommend to be read, if you have still not done), are more motivating character than an explanation " rules of the game. "

Success to you!