Being financially independent requires someone to save a lot of money, and to invest the money in various investment options like the stock market or the foreign exchange market. Financial experts have repeatedly encouraged employees and entrepreneurs to save more money, and they also provide tips on how people could manage their finances effectively.
1. Keep 20% of your salary and profit as your savings, and deposit them in a bank for additional security. Money kept in the bank could also earn interest over time. You could also set up a goal regarding the amount of money that you wanted to save, or you can also increase the percentage of the savings that you would need to keep from your profit and earnings.
2. Keep track of your expenses. Make sure that you keep a journal recording all of the expenses that you incur per day. Make sure that the money you earn is more than the money you spent. Try to curb expenses on unnecessary things, and focus solely on food, clothing, and utilities. If you manage to perform this tip successfully, you would notice changes in your savings, and your bank account would reflect more money due to the effort exerted in saving more.
3. The savings that you kept from your salary and business profit can be invested in the foreign exchange market. Many people are investing in foreign currencies. This investment could produce a lot of profit for the investor, especially if the currency value jumps. The Vietnamese currency, for example, is experiencing an increase in its value, attracting investors all over the world to invest. There are also a lot of foreign exchange applications that can be downloaded for free via application stores.
4. You can also try investing your money in the stock market. The stock market sells shares from different companies, and depending on their performance, your investment could rise or fall. There are also many factors that could affect how the value of the share changes. It is important that you read a lot of resources before deciding to invest in a single company, and you can also ask for professional help to determine which company you should invest in. The stock market is also one of the most accessible investment options, as online platforms specializing in stock market investment can be downloaded, providing services 24/7.
5. If the stock market intimidates you, you can opt to try joining a hedge fund instead, and allow a professional to take care of your investment. They are claiming that the structure of how hedge funds work is effective for those who want to invest their money in a reliable investment option. It also gives the investors less stress, as they no longer need to think about their money because someone is managing his or her assets for them.
6. You can also set up a business with the money that you saved, and try to open up a business that suits your passion or interest. One of the most common businesses is inclined with the food services sector because it is easier to manage. However, tech companies are also becoming more popular as the world relies heavily on new technological products. If you are knowledgeable when it comes to programming, you can try creating a software program and sell it online, or start your own software development firm.
7. Avoid being swamped by credits, and make sure that you are paying all of your dues on time. Think about the penalties and the interests that you would have to pay if you are always late on your payment. If these amounts accumulate, it could transform into a huge amount that would be hard to pay back. Make sure to keep track of your payments to avoid any disputes.
8. Always keep track of your savings and your investments. If you are successful in managing your finances effectively, you will notice great changes in your life. Just remember to keep the investment cycle going on. This could be the source of your passive income, which will be helpful if you no longer are able to work to earn money.