Why investing in assets first will safe guard your finances.
As a society it seems that we are forever doomed to do things backwards
– simply because that’s the way the generations before us have done it, and
investing and looking after our own financial well being seems to be no
different at all.
Our spending habits are no different. For some reason we buy the nice
home, the car, and all our modern gadgets and accessories before we are even
able to afford them. In fact we often would rather first spend all our money on
liabilities (those things that make money leave our bank account every month)
than we would on income producing assets.
Doesn’t it make more sense to make the money first before we spend it?
In all honesty, I have fallen victim to this way of spending too, until I
recently re-read Robert Kiyosaki’s “Rich
Dad, Poor Dad”. A part of me feels that I should really be kicking myself
for completely forgetting this rather important lesson – if you want financial
freedom, then I highly recommend that this is something you really start to
apply to your life and spending habits TODAY!
So how do you go about doing things the right way around?
Well first things first – start by changing the way you think. Let’s
for example look at buying a car – quite often this is one of the biggest liabilities
a lot of us will take on.
Look at the car you really want, and ask yourself “How can I afford it?”
– and ask yourself this question seriously. It is actually something I have
started to apply very regularly whenever the wife and I go shopping, whenever
one of us looks at a “big ticket” item – usually the type the requires some
kind of payment plan, I ask “how can we afford it?”
But I don’t just stop there, I look at the item’s price, work out what
the monthly instalments would be, and how much we would end up paying for the
product at the end of the day. You will absolutely amazed at how many times
adding interest almost doubles the end amount paid. If you can, rather choose a
lay-bye option, you might get your new items later than you would like to, but
you will save a lot of money on interest.
So once we know how much we can expect to pay, and for how long we will
be paying for, I then ask, what income producing asset we can invest in that
will create the income we need to cover the expense of the item.
Now there in lies one of the biggest secrets to financial success –
first invest in assets that will pay you the money you need to purchase
liabilities. Do a little research and see what you need to do to earn that
extra money. Perhaps you would need to add more rental properties to your
portfolio, or perhaps invest in more dividend paying shares, or grow a network
marketing business, take on more freelance work, etc… you can even be creative,
do a little research you may be surprise by what you can come up with.
Believe it or not, but by doing this and starting to apply this
practice to your spending approach, you will find that you are far less likely
to find yourself in a “spot of financial bother” later down the line when the
expenses on your liabilities far exceeds the amount of money that you have
coming in.
And to make sure this is a lesson that I never forget again, I have
actually invested in the audio version of “Rich Dad, Poor Dad” too… for me to
listen to a lot more regularly, I highly recommend that you do the same, click
on the image below to get your copy now.
So who of you who are joining me with this experiment are panicking yet?
Is your inner voice telling you to stay away from gold – after three weeks of
coming down, that voice might be telling you to RUN away from gold, right?
This week, the gold price came down even further, so 0.1gram of gold cost me ZAR74.19. Today’s gold price is sitting at around ZAR580, so after 3 weeks this investment is currently sitting in the red by ZAR49.74.
Just hang in tight and ignore that little voice. The price of gold is
coming down, it is cheaper, and now is a really great time to buy even more.
Have a look at the below graph that shows where it was ten, or even five
years ago and you will see it is in an overall upward trend. The price you are
purchasing gold at now, will be the price you will be wishing you could buy it
at in five or even ten years from now.
Please watch the below video on my YouTube channel, it will give you a
really great outlook on where the gold price is heading.
The SATRIX40 fund is looking fantastic. Even after this week’s
investment of R74. 19, the total investment is sitting at ZAR225.58 – which means
it is running at a profit within just 3 weeks.
Value investors, such as Warren Buffet, always recommend and support
investing in Index funds such as these, and I think it really is beginning to
become apparent why. It already has had good growth within just a few weeks.
The only question you should be asking yourself is - why haven’t you invest in
this yet?
Go onto SatrixNow.co.za and start investing today. There is no minimum
investment amount required, so you can literally start investing today, no
matter how small your budget is.
Now a look at this week’s crypto currencies.
Because of the holidays, there was a delay in the clearance of funds
into my crypto wallet, however this actually turned out to be a good thing. By
the time the funds cleared, Bitcoin had dropped in price by around R4,000 –
which meant it was much cheaper to buy.
And guess what? The value of Bitcoin has still grown sufficiently for
us to be in the green with this investment too! Very exciting.
We are still in the red with Ethereum, but only slightly, and overall I’m
pretty happy with both of these two investments so far.
To start investing in crypto today, click on this link:https://www.luno.com/invite/73MNGD
It is possible to create investments that will eventually pay you a salary,
and depending on how well you plan it, it could be a monthly salary.
Ideally this is the type of investment strategy that you would start
working on while you have a job where you are earning a salary every month. To
be successful at creating an investment portfolio that will eventually be
paying you, possibly enough for you to not even have to work anymore, here are
a few rules to abide by.
Rule # 1: Pay yourself first
All this simply means is, dedicate to investing at least a minimum
amount of your earnings every month – at the very least 10% of your salary.
Before you even pay your bills, buy groceries or anything at all, if you truly
want to be a successful investor you have to be really strict about this.
For example, if you are earning ZAR10,000 per month, make sure that you
invest at least R1,000 per month – WITHOUT FAIL! How badly do you want your
future to change? Do you want a better life? If the answer is yes, than you
quite simply HAVE TO DO THIS!
Rule # 2: Do your research
When you invest this way, by looking for value, what you are
traditionally looking at is stocks in reliable companies that you can invest in
for the long term.
Research the companies you are investing in (especially if you are
purchasing shares on the stock exchange). You want to invest in long lasting,
reliable companies that pay dividends. Dividends are the profit payouts that
will become your regular salary – so pick STRONG companies that pay out
dividends to shareholders every year.
But no matter what you end up investing in at the end of the day, make
sure you research it first. This step can help prevent financial loss and
heartache, and can help you to grow your own wealth.
Rule # 3: Diversify
You are building a foundation of wealth for your future. Don’t put all
of your eggs in a single basket and hope that it will be that one thing that
will make you wealthy or financially free. Have a number of investments, (my
YouTube channel is packed full of really great ones to help to get you started,
so subscribe to it today).
Even if you can only afford to invest in only one per month – get started
and do just that.
Rule # 4: Have a plan
Have an investment plan, not sure what that is, then ask yourself these
few questions, once you know the answers to these you will have a pretty good
idea as to what your investment strategy will be:
1.How much are you going to invest every month?
2.How
are you going to invest every month?
3.How
much would you like your investments to pay you every month?
4.How
much would you have to have invested for this to happen?
5.How long will it take you to get to this goal?
Once you know the answers to all of these, you are in a pretty good place
to start.
Rule # 5: Invest in yourself
What does this mean? It means educate yourself on what you are doing.
Truly successful investors read books and attend courses on an assortment of investments,
investing strategies, and general self improvement. Get to know every possible
thing you can about what you are doing.
When you know what you are doing, especially as far as investing goes,
then you will be removing most of the unnecessary risk. If you really know what
you are doing then you find it easier and easier to be able to grow your own
financial wealth.
Step 6: Start with a confidence booster
If you are brand new to investing, and you really want to do it so you
can secure your future wealth and take charge of your own money, then start
with something small that will give you great confidence.
A really good place to start would be in an index fund – they have
great returns and are usually quite affordable to get started investing in.
Once you begin to see your money actually growing in value, this will give you
the confidence to really start with investing.
If you are from South Africa, like me, a great site to invest in Index
Funds is Satrixnow.co.za
Looking for possibly the best book ever published to get you started on
your investing journey? Then here it is. It has everything to help get you
started on your investment journey.
Welcome to this week’s first financial weigh in, I am so excited to be
sharing this with you. Today I am going to cover the first investments
made, how they are looking, as well as go over the three platforms I decided to
use.
I have decided to split the financial weigh ins into three different
videos and sections, this will make it easier for you to follow and refer back to,
especially if you only wish to follow only one of my investments of choice.
Please remember to subscribe to my YouTube channel, and remember to hit that
bell notification so you get notified every time I post a new video.
I was so excited about this experiment, that last week I found it very
difficult to only purchase one set of investments, but I managed to somehow
hold myself back and not blow my entire investment budget for the year in just
one week.
So…
Last week, straight after posting the announcement video, I went and
purchased my first round of products, I did this so that you can see how the
past week has affected these investments. I’m going to go through each one with
you; I’m going to show you the price when I bought the product, what has
happened in the price for the past week and how it is affecting the purchase
price for this week’s investments.
Starting with gold…
Last week 0.1 gram of gold, all expenses included, cost me R75.31.
Taking expenses into account, and the price of gold on the day, which was
R587.44, this meant that after trade, I was in the red (meaning running at a
loss) of R16.57.
Over this past week, gold dropped in value, which believe it or not is
actually good news.
The gold price is, as of this week Monday was sitting at R577.55 per gram. This means
that last week’s investment is now sitting even more so in the red by R17.56.
However, this is fantastic, because it means that this week, gold is
even cheaper to buy, so now you really want to be investing. Today 0.1 gram of
gold, cost me R74.24. This means that by the end of today’s trade, I was in the
red in total by R34.04.
I am quite happy about this, as I know that gold is in an overall
upward trend, and this money will be made back, and then some.
Why them? Not only do they have Cashgold which you can buy as paper
money from 0.1grams of gold, and small 1 gram gold bars, very neatly and safely
packaged in a credit card style, but they also have:
1.999.9 bullion gold, making it a superior grade
2.They
store the gold for you, but you can request to have it shipped to you at any
time (just pay for the courier fees)
3.They
are Forward thinking and are launching a purely gold backed crypto currency
(making it the safest crypto out there)
4.They
have an affiliate program that can bring you significant rewards (and help you
successfully launch a home based business)
5.You earn commissions in Euros (they supply you
with a Mastercard debit card that you can use worldwide to spend your
commissions)
Next up let’s look at the stock exchange investment.
After purchasing my 0.1 gram of gold, I then went and took the exact
same amount of R75.31 and invested it in a Satrix40 fund. After fees, my total
amount invested came up to R75.01 – this put me in the red for a mere 30 cents.
This week, my initial investment is now worth R75.41 – which actually
puts me in the green (meaning not even a week later, I am already earning
profit on this investment), of ten cents – it may be a very small profit, but
it’s the kind that reflects just how huge the possible long term growth of this
investment can be.
This week, I invested an amount of R74.24 – the same amount as 0.1 gram of bullion gold. My investment, after expenses came up to R73.95. This brings
my total investment up to R149.08. This means that, after expenses, I am
sitting in the red by R0.47 – and I am really quite excited to see where this
investment will be sitting by next week Monday.
For this specific investment, I went onto SatrixNow.co.za and opened an
investment account. It is an incredibly easy
investment to make, and the fund invests in the top 40 companies on the JSE
(Johannesburg Stock Exchange) for you, without the hassle of you trying to
manage these shares yourself. In fact I highly recommend this investment
because of four main reasons:
1.It is incredibly easy to start investing
straight away (register your account, upload your KYC / FICA documents, and
begin growing your portfolio)
2.You
get the best growth on the fund from the top companies on the stock exchange
3.They
have a number of funds that you can invest in that will help you to easily
diversify your investment portfolio
4.You can send gift vouchers through the site to
friends and family members to get them started with investing too
In fact, all three of the investments I am sharing with you, I am
gifting to my own family this year for their birthdays, because it’s not only a
great, affordable gift, it helps me to help my family to secure their own
future financial wealth.
Lastly, let’s have a look at the most disputed modern investment out
there – crypto currencies.
I have personally done a huge amount of research on crypto currencies,
and the result was that I have invested in a number of ways into this specific
product. Why? Because it is here to stay, not only that but it is transforming
our world in ways we can’t imagine, especially the technology, that is
blockchain technology, that supports this type of currency.
It is so big, that Japan has already made Bitcoin its second official
form of currency. If you haven’t invested in it yet in some form or another,
then I highly suggest that you do. In fact my personal crypto portfolio has had
the highest growth of all of my investment portfolios this year alone.
I recommend that you go and do your research on crypto currencies and
blockchain technology, so that you can better understand just why you need to
get started with this kind of investment.
For this experiment I decided to invest in the two top crypto
currencies, Bitcoin and Ethereum.
I decided to do something a little different here, I’m going to take
the amount that I invested in gold, and split it 50/50 between these two
currencies.
So because we are only investing half of the value of 0.1 gram of gold,
the initial investment into Bitcoin is R37.65.
This bought me 0.00048216th of a Bitcoin. The price of a
Bitcoin on the day was R76,556.00. After fees, I was in the red with this investment
for an amount of R0.74. Bitcoin improved a little this week, bringing that
amount down to R0.73
This week half a 0.1gram of gold bought me R37.12 worth of Bitcoin,
which gave me a slightly smaller amount of 0.00047447th of a Bitcoin
- bringing my total Bitcoin up to 0.00095663th of a Bitcoin, to the rand value
of R 73.25, and placing me in the red by an amount of R1.52.
Now something very interesting happened with Ethereum this week.
As with Bitcoin, I initially invested R37.65. This bought me 0.01418109th
of Ether. With the price of Ethereum at R2458.39, this placed me in the red for
R2.79.
Now… This week Ethereum dropped to R2323.76 for an Ether, and my
investment value came down to R37.12.
However, this managed to buy me 0.01467342th an Ether, which is
actually more than last week by 0.00049233th an Ether. This means that I spent
LESS money but got MORE Ethereum, so I highly recommend that if you are
investing in Crypto this week, perhaps invest the full amount in Ethereum,
rather than Bitcoin because you are receiving more for your money.
The platform I decided to purchase my crypto on is the Luno Wallet.
Here are the top 5 reasons why I chose this specific platform.
2.The
website is very user friendly – no confusing extras as I found with many other
crypto currency wallets.
3.It
is really easy to deposit funds in to your account from any South African bank.
4.Refer
a friend and earn a commission – they too have a really great affiliate
program. Share your affiliate code with those closest to you and get them
investing too.
5.You can invest from as little as R10 – that’s
right only R10! No more excuses about not being able to afford to invest.
And that's how the investments are looking after the first week and going into the second week.
Now here comes the scary part, looking at all my investments together.
The important thing to keep in mind here is that I have only just started, this
means that I still need to recover most of my transaction fees, and I will
expect to be in the red.
What I am doing here is planning for long term investments, and I will
eventually find myself in the green for all my efforts… so let’s see how it
looks after week 1.
Over the past week, I have spent a total of ZAR448.64 (this is for the
first initial investment, plus this Monday’s investment).
After fees, the actual value of my investments is sitting at R404.89.
Putting me in the red, running at a loss of R43.75
But as I mentioned, I’m not terribly worried about this as I’m pretty
sure that by the end of the year, magic is going to happen.
Remember to give my videos a thumbs up, and let me know how much they
helped you in the comments section, or just leave me an emoticon to brighten my
day.
Also feel free to share my videos and blog posts, and let’s get
everyone creating those investment portfolios.
Until next week’s Financial Weigh In, remember to always
Recently I have been sharing a lot of information on investing, especially as I am getting ready to launch my investment experiment, with the very first "Financial Weigh In" coming this Monday!
So I figured, to help get you ready for the launch of the experiment, here are 5 really great books to listen to to get you in the mood.
These are currently my top five favorites, and if you would like to get your very own copies, click on the image of the books.
Below titles are currently FREE for kindle while stocks last:
Hey guys, I wanted to share this post with you because it’s something
that has been playing on my mind, and I feel that it REALLY is something that I
need to share with you.
In 2011, I walked away from having a job, I was determined to start
doing things my way and to succeed on my own terms.
For the first three years
or so, I fumbled around trying to discover what it was that I really wanted to
do, and how I was going to become the successful person that I knew I wanted to
be.
Then about 5 years ago I started to discover exactly what it was that I
wanted, and I took my focus and started to train it on that goal.
Over the past 8 years I have had a number of blogs, I have written and
published four books (my fifth is on the way) and I managed to launch an online
brand that allows me to earn passive income. During this entire process I have
been very determined to work on myself too.
I have taken a lot of self improvement courses, I read piles of books,
and I actively apply self improvement practices to my life. One thing I have
noticed lately though, is that all of the people I follow and listen to, all
the authors of the books I have read, all have one thing in common, just one
thing.
Can you guess what it is?
At the end of last year I did the Millionaire Mindset Masterclass by T. Harv Eker. Straight after which I bought his book, which I read immediately. I
then did this one big thing that made all the difference, and since I did it, I
have noticed that every successful person I listen to, every successful person
I meet, they all have this one thing in common, they all have done this one
thing.
Want to know what it is?
Check out my today's video where I will be telling
you exactly what it is…
Oh, and I am also going to be sharing an interesting investment experiment
with you, that you are going to just love! So you really don’t want to miss out
on this one.
If you too want T. Harve Eker’s life changing audio book, click on
the image below to get it now.
Another decade is edging closer, in another three years time I will be looking down the barrel at the big 40... a milestone birthday into adulthood I think.
Every year as it edges closer, I start to take an even closer look at my finances and the investments I have... or rather haven't... made and what my financial outlook is for my upcoming years (oh my gosh, I feel like I just used too many "big" adult words in one sentence).
In short, it means I am panicking just a little about my future, and in particular my future wealth, have you ever had moments like these? Or can you honestly say that you have set up a series of investments that will secure your future?
The idea of possibly job hunting in my fifties, or struggling to pay my bills in my sixties, or being in my seventies and not having owned my own home - these are thoughts that scare me, and these are the thoughts that keep me awake at night.
For most of the past decade I focused on creating a stream of passive income - which is really great for the here and now, but this year I made a conscious decision to start looking at my future wealth, and to start making investment decisions that impact me positively in ten, twenty, thirty years and even beyond that.
I use a really great tool to help me when deciding on what investments I should make, which I will be discussing in further detail on today's Facebook Live chat, click on the image above to join in. Don't worry if you miss it though, I do save all my videos to my Facebook page, so you can watch it at any time.
The really exciting thing is, that if you really wanted to you could find a way to start making investments from as little as $10 (ZAR100) or $30 (ZAR300) a month. I'm not talking about saving, but instead actual income producing assets.
My most recent, largest investment currently cost me around $1,200 once off (around ZAR17,000) which really isn't a lot in the greater scheme of things, and I know that ten years down the line it will infinitely begin to produce a regular income for me. My smallest investment is going to cost me.... wait for it... around $50 (Around ZAR600) per month, but within five years it will not only be paying for itself, but it will continue to earn me an annual income for the foreseeable future.
Everyone, irrespective of their age should not be saying "I can't afford to invest" because in truth, you can't afford to NOT invest right now, especially if your aim is to have a financially secure future.
Read my previous blog posts for loads of ideas on how and where to invest today!
I look forward to sharing my Facebook live videos with you, until then remember to ALWAYS invest in yourself!
