Financial literacy has been a major subject for many discussions as we lack financial education in our schools, home, and work. These have led to many unforeseen circumstances for many families; the impact has been a catastrophe, which wasn’t intended. Therefore, it’s become crucial for one to understand how to protect one’s assets. Here are a few pointers to ensure your financial stability excellence despite a terrible economy in the future.
1. Avoid Spending Like A Fish
You’ve heard the statement drinking like a fish; however, there are instances where one spends like a fish. We grew up watching Hollywood painting luxury and brands as affordable items for many. Therefore, the moment we start earning a sufficient income we tend to spend on Bvlgari, Prada, and Armani and we forget that even flea markets offer the best options too. However, these forms of investment hold value only under one’s eyesight and they fail to provide any financial values. Eventually, this form of unprecedented spending leads to a bad financial status. Therefore instead of spending your money on invaluable assets, try saving and investing them in profitable and passive income generating avenues.
2. Avoid Investing in Unsolicited Investments
Well, we have all heard that investing is the best way to ensure financial security. However, an unsolicited investment such as bets and gambling can lead to a great loss. Usually, this happens in the superstitious-ness of one’s mind; being influenced by the Do’s and Don’ts of gambling or avoiding the Number 13 bets becomes the key factor when one indulges in gambling. However, one must also realize that not everybody can be the master of the game and the house always wins. In our world, being influenced by quick cash and fast riches has to lead to the destruction of many finances. Therefore, investments are definitely a good idea, however, there’s a fine line between investing in a share market and investing in a slot machine.
3. Avoid Putting All Your Eggs In One Basket.
You might have heard this saying, “don’t put all your eggs in one basket,” and that definitely resembles how finances should be handled too. This concept applies to savings and investments. Therefore, instead of keeping all your money in one bank account, one might as well diversify one’s assets. Hence transforming all income into either valuable assets, bonds, savings or other currencies is an excellent idea. This gives you a cushion and a backup plan in case one of your finances falls through; you will definitely be able to recuperate through your other “baskets”.
4. Avoid the Term “Settling Down” Until You’re Ready
Humans are programmed with a routine; we are all taught at a very young age that the biggest priority is to follow a pattern of life. Many of us find our soul mates, get engaged, married and proceed to have children. This is where the term “settling down” comes in. Our first investment would be a car and a house under a mortgage. While many debate the importance of not having a real estate and asset investment, Guy Kawasaki mentions that taking a mortgage is what has kept half the world population in debt. Hence, avoid the term settling down until you’re ready. You should have a surplus of passive income, which gives you the comfort and confidence of purchasing an asset or real estate without being bonded with a mortgage. Loans and Mortgages exist as a diabetic sepsis to keep the world constantly in debt. Hence, if you’re able to break free it gives you a great incentive for a financially stable life. There are many ways to ensure your financial stability. These are some simply, precautionary methods to help you towards a stable, wealthier and happier life. While many say that money doesn’t buy you happiness, it certainly builds a bridge for it. Featured photo credit: Tumblr via europedirect.lt
