In order to take control of your financial future, it’s important to learn how to make wise financial decisions. To discover a few financial habits which you should adopt, simply continue reading!
Instead of waiting to sell your investments in order to earn a profit, it’s a wise idea to invest in investment opportunities which offer lucrative dividends. As you’ll be able to earn regular passive income from your shares, without having to sell them. Better yet, you’ll be able to reinvest your dividends, which will help fast track the growth of your investment portfolio.
It’s a great idea to invest in blue chip stocks, which offer monthly dividends. If in doubt, opt to purchase shares in businesses which boast yearly dividend rates between 5-12%. In particular, you can’t go wrong purchasing shares which offer high, yet sustainable dividend rates of 6-9%.
Concentrate on accumulating assets instead of wasting money on purchasing liabilities:
The average individual leads an average life and does not become financially free as their focus is on accumulating liabilities. Such as expensive cars and clothing. Instead, if you want to be wealthy and to be able to retire early, you need to refocus your brain to concentrate on accumulating assets. Assets include property, property shares, private equity, ordinary shares, ETF shares and precious metals.
Know the difference between good debt and bad debt:
Good debt can be used to purchase assets such as property. While bad debts include credit card debt and personal loans. All of which feature incredibly high interest rates. If you currently have debt, such as unpaid credit card debt, it’s well worth working hard to pay it off as soon as possible. So that in the future you’ll be able to pump your extra money into investments. Instead of paying off your loans.
Create a monthly budget:
At the end of each month it’s a great idea to sit down and to create a detailed budget for the upcoming month. Make sure to set money aside for new investments, before you allocate money to socializing or purchasing new items such as clothes. As your financial future is far more important than spending a night drinking with your friends or purchasing a new pair or designer shoes.
As an example, you may want to start with setting yourself a goal of investing $500 per week as a minimum amount. After a month you may want to increase your goal to investing $1000 per week. In order to find more money to invest, you may want to cancel your subscription services in order to free up a bit of extra cash.
Get into indices trading:
To further diversify your investment portfolio, it’s well worth investing in indices. To get started, search for a reputable platform which specializes in indices trading in South Africa. As the more asset classes that you invest in, the less risk that you’ll face as an investor and the more likely your investment portfolio is to grow from strength to strength.
If you follow all of the financial strategies which have been listed above, you should be able to quickly improve your finances and to start building a lucrative investment portfolio!