Category Archives: WQ

Speculation: One of the keys for wealth control and management

Speculation in capital markets has been given a bad name for years, probably because of the risks & pressure involved. Many have come and gone in this industry over the past few years, some left with unimaginable wealth, while some left with nothing in the bank account. Sure, speculation is very risky, and can be considered one of the riskiest skill, because not only it involves money, but also emotions. Fear of losing wealth and the greed of making wealth is what drives the people and as a result, the markets.

Being a foreign exchange trader for a few months, I realize that speculation is truly a key to wealth control. As compared to a 9-5 job, u won’t have to wait for the end of the month to get your pay & unlike brokerage jobs, the wealth isn’t limited to the sales. It’s all about money management and trading strategy.

Speculation is a life-changer, in a positive way, only if we practice two skills:
1)Managing Money
2)Managing emotions

Many people have succeeded in trading, because they mastered these two skills, through trial & error, through mistakes and consequences, and they learned it the hard way, but never gave up on their dreams & goals, as the Great Henry Ford once said, “Obstacles are those frightful things you see when you take your eyes off your goal.” Never giving up is the only key to winning.

Knowing when to get into the market & when to get out, when to bet big & when to bet small is the key to long term success in trading. One can get financially independent, only if one knows how to manage emotions in a bull/bear market, and how many lots to trade in a volatile market.

Speculation is surely risky, and as people say it is indeed a form of gambling, but learning from your own mistakes and the persistence to keep going, is the only key to long term prosperity.

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Be a better money manager by learning “The W.Q. Star”

 

Wealth management is one of the prime concerns of everyone. And if you want to ace wealth management, you need to understand the value of the 5 elements of perfect wealth management.

 

1)    Earnings

It’s not the amount of money you’re earning that makes you rich, but the amount of money you can save for its further growth makes you rich. E.g. you’ve $10,000 income from your job, and if you can save not a single penny from it, you won’t achieve financial independence this way but if you can save $2000 and further invest it, your chances of financial freedom increase.

Earnings are different from income. Income is the earnings from your job, while the dividend obtained from any mutual fund, or rent from real estate investments can be considered as passive earnings. So, earnings are combination of income from your job, the income that you obtain from investments e.g. real estate, stocks, business etc. is passive earnings, there are also royalty earnings, and the newest kind of earnings is LIABILITY EARNINGS, this earning can be obtained from liabilities! You just need some innovation and sources to earn from liabilities!

So the first step for financial freedom is to note down every source of earning that you’ve, how much you are getting from it and what’s the duration of this kind of earning. E.g. royalty earnings are for lifetime, job earnings are for a limited period, passive earnings keep coming until you sell the investment, so note down everything to get ready for the next element.

 

2)    Budget

Budgeting is the most important aspect of wealth management. It helps you in balancing the earnings and expenses. The main element of financial freedom: investments. If you can balance expenses and earnings, and save enough to invest, the worth of budgeting goes quadrupled, because the main motive behind budgeting is to reduce the irrelevant expenses and invest the savings. Remember: expenses are basically of three types 1) Basic 2) Desirable 3) Luxuries.

 

The goal is to reduce or postpone the desirable and luxuries expenses, since basic expenses can’t be ignored. Save this money and start investing! When you’ll get some passive earnings, you can increase your desirable and luxuries expenses.

 

Prioritize your expenses, pay off the priority debt first, and gradually reduce the debt. These are some of the ways to effective budgeting.

 

3)    Invest

The best friend to your financial freedom. Investing opens the doors to financial freedom. You just need to be more aware about the investments that can give you more returns.

 

Start with basic investments: Gold and silver. These can be considered as the best investment options with low risks and no overhead costs. The next category of investments have increased risk, e.g. stocks, options, mutual funds, ETFs etc. But unlike gold and silver, their risk is highly volatile and returns are never assured, so I suggest learning more about wealth quotient before proceeding with investment.

 

The third and one of the famous investments for exceptional high returns and low risk is the Real estate. Benefit? Leverage and consistent earnings. You can buy a house of 100,000 only by paying around 10,000-15,000 and this is the biggest advantage of real estate. Your earnings start with the first rent check, and real estate maintenance costs aren’t much as compared to the returns it gives. Try to invest in real estate if you want to accelerate towards financial independence.

The next category is business, where risks reach to a new level, but the returns are infinite if successful, if you know about “The L.Q. star” the business leadership and management becomes easier for you.

So start your car and begin your journey to financial freedom by investments.

4)    Protect

You’ve made your investments and reaping the returns, but every investment comes with risks, and you too can reduce the risk through protection.

E.g. if you’ve invested in real estate, protect the property from damages caused by calamities, or any damage by your renters. This helps you maintain the value of the property. Hire a good property management company, it’ll help you find new renters, take rents regularly from them, and keep you and your renters happy. Have your renters insured with renters insurance, so that in event of damage to anyone in your property, insurance will take care of the renter’s expenses. In this way, you can reduce the risk in the real estate.

 

Protection plays a vital role in business, where large financials and products are involved. Many people have suffered from losses due to unpatented products, and this ignorance of protection leads to big losses. Protect your company by choosing the right corporate entity. In this way protection can prove to be a life saver in bad times. So never forget to protect your wealth.

 

5)    Expense

Last but not the least, the element of utter importance in everybody’s life; expense. At this point, you’ve budgeted, saved and invested and reaping the earnings. But now it’s time to use the earnings. Most people spend almost 100% of the profit from investments, but this never leads to the road to financial independence, instead divide the profit in some sections,

 

E.g. 50% of the profit could be invested back to reap more profits, you can vary the percentage according to your needs. 30% to the desirable or luxury expenses and 20% to philanthropy. Expenses are endless, but you’ve to make the right mix in order to live a luxurious life along the financial independence. So take care of your expenses, and never forget to giveaway some money. Because giving away always creates a sense of satisfaction of helping others.


So combine these 5 elements, use them in your life, and get to the path to financial independence and infinite success.

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3 questions to effective wealth management

Just three questions to yourself can change the way you manage your money.

Many people don’t know about the money trap existing in their daily life,they start by buying a few luxuries,pay their installments and proceed buying the next ones,and this goes on each year,and they never realize that they’ve become so habitual of buying luxuries,paying the debt and buying more luxuries, they are in a money trap but they never know whats wrong with it.

There’s nothing wrong with buying the luxuries,except the fact that they’re in a “Ring Of Debt”, its a ring of infinite lifetime that never ends until you realize that you’re a part of it,yet many people die peacefully,unaware about it.

Well the concept is simple,you start buying few luxuries,pay the monthly installments,then buy more luxuries by debt.Though you save for some investments,but since you don’t know the right financial instruments for good returns,you buy funds that are managed by a fund manager,and these funds never give you desired results.

You buy luxuries each year either by cash or debt,mostly by debt,invest in low return investments and never take out the time to get more knowledge about the power of investing and the perks of getting a good wealth quotient.

Get yourself out of this “Ring Of Debt”, where you spend your lifetime paying the installments, increase your wealth quotient and get the advantage of gaining financial independence and get out of this “Ring Of Debt”.

Ask this 1st question to yourself: What were my activities that brought me in the “Ring Of Debt”?  In this way you can evaluate your financial management and understand whether you’re in the right path to the financial independence.If you’re involved in too much debt payments you need to reduce them first and increase your savings by reducing the frequency of your luxury expenditures.

Next ask yourself the 2nd question: Why am i involved in the “Ring Of Debt”? If you’re involved in the ring,you can understand if this is the lifestyle you desired,if these were the goals of your life,then no problem,you can continue with it.But if you think that you need to get a more stable and successful path to passive income and effective financial management,you’ve to take out the major cause that brought you in this ring

It can be multiple causes,you’ve to take that out of your mind, note down,and eradicate it from your lifestyle.From next time if you want to become a good money manager,ignore the cause that brought you in this ring.

3rd question”How can i get out of the ring and gain financial independence?”   Their can be numerous reasons that brought you in the ring of debt,most common are the child expenses and daily luxuries.You can’t ignore them,but i can tell you a way that can bring you out of that mystical ring and take you to the path to financial independence.This questions helps you to look for answers and knowledge that can take you out of the ring.

The most effective being the wealth quotient.Understand what are the best investment tools that you can use to maximize the gains out of your savings.You’ve to take out some time daily to understand the value of wealth management and planning.When you’re able to understand it,you’ve to apply it in your life and bingo,you’re on the path to financial freedom.

Read my latest book “The Power Inside Me” for more knowledge about the wealth quotient.

1st STEP TOWARDS FINANCIAL INDEPENDENCE:BUDGETING

The only difference between a rich person and poor person is how they use their time and money-Robert Kiyosaki

Everyone in the world dreams of achieving financial freedom,some dream of achieving it through business or extra job,some dream of saving as much as they can,some dream of investing and  some even  dream of living cheaply!!

But they all forget the basic step involved in achieving the dream:BUDGETING.

BUDGETING in summary is all about tracking and balancing your:

1)INCOME

2)EXPENSES

3) DEBT(DUE TO LIABILITIES)

4)INVESTMENTS(ASSETS)

It doesn’t involve any complex mathematics as many fear about it!Once I heard a story about an average homemaker who used four matchboxes for these categories and distributes equal amounts in every box,and noted down the money left in each box every day,did simple addition subtraction and budgeted for next 10 days!its easy if you enjoy doing it!

I’ve heard some people saying”i don’t have enough money,how can i do budgeting!”

At this point i remember the famous quote by ROBERT KIYOSAKI”Money is just an idea!

It doesn’t matter whether you’ve $10 or $10,000 in your pocket,what creates a difference is how you budget and use them!you can make $10,000 from just $10,or can just save $10 from $10,000

watch the following video about BECOME YOUR OWN FINANCIAL PLANNER  featuring famous author BRIAN TRACY

Follow these tested basic tips for budgeting:

1)Take a notebook or a journal with days,dates on each page,start tracking your expenses,debt,income,investments

2)Expenses can be categorized as a)essential b)desirable c)liability.put your expenses in each of these categories e.g groceries are essential,getting a more expensive cellphone is desirable and buying a car is a liability.

Liabilities are long term expenses as they are generally bought with debt which is repaid for long term.but if you are able to cut your desirable expenses and invest that money,you can get solid returns and more better cellphones later!

3)Create a rule for your own budget and follow it sincerely e.g my own rule is 25-25-50.i give 25% of my income to charity,25% to myself and family gifts,and 50% back to business for its growth!

you can create your own rule for your needs!It’ll take some time to create a perfect rule for yourself,but believe me you’ll get in a better financial situation afterwards.

4)Think creatively on expenses e.g buy groceries on cash,and be clever on bills,e.g my credit card bill comes on 10th of every month to be paid on 30th,so i buy DESIRABLE stuff after 11th of that month,so that i can get enough time to balance other expenses before the bill arrives

FOLLOW THE ACTION STEPS:

1)Get a broad look on budgeting and financial planning through the book written by BRIAN TRACY”GETTING RICH YOUR OWN WAY”

GET THIS BOOK NOW AND LEARN FINANCIAL PLANNING click here

Indian Readers click here

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