SAVING AND INVESTING
For anyone who wants financial success good money management
is important. This is an important secret of riches and wealth.
People who have jobs or business should try to pay themselves
first when they receive their income. At least they should pay themselves 10
percent of their income; they should pay themselves before they pay their
bills, or do anything with the money they receive.
Lets say they earn $500,000 a month, 10 percent will be:
$ 500,000 * 10/100 = $ 50,000
START SMALL
Realistically It might not be easy for many people to pay themselves 10
percent of their income, for some reasons. So it’s advisable that they start
by paying themselves just 5 percent of their income. This money shouldn’t be touched, for any reason until it accumulates to an
amount that they can invest.
This is vital because many people remain poor because they
don’t pay themselves first, this people spend everything they earn in addition
to loans they collect. When they are paid they start paying the debts they have
accumulated, at the end they have very little to use for the month before their
next pay. In a short time they finish the money they have and start collecting
loans again; it now becomes a never ending cycle.
BREAK THE CYCLE
To break this cycle one must pay him or herself first.
In the classic book Richest Man In Babylon written by George .s. Clason says
this:
“The cure
for cure for a lean purse .... For every ten coins thou placset within thy
purse take out for use only nine. Thy purse will start to fatten at once and
its increasing weight will feel good in the hand and bring satisfaction to thy
soul”.
This is very true! If one earns $10 a day. One should pay
himself $1 before he spends the rest. This one dollar should be paid into a
savings account every day. As the days multiply the account balance will fatten.
If someone does this for 30 days, one will have $ 30, for 365 days (1 year)
will be $ 365.
Saving is the first step, one will need to invest
this money wisely so that it can multiply and continue to multiply.
Finally anybody who uses this principle of saving and
investing in addition with the other principles I have just discussed about is
sure to succeed in life.
To use this principle of saving and investing one must
control his or her expenditure, than to delay immediate gratification. It takes
self-discipline to save a percentage of what one makes on a monthly basis. It may
be difficult but it must be done, this is one of the ways Warren Buffet the
world’s richest investor became rich, if he did it so can you.
Thank you for reading this book to this point. It shows that you
really want to succeed in life and I will be committed to making you succeed.
Please join me in the general conclusion in the next page.