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Money matters

Discussion in 'Money Matters' started by Viswamitra, Dec 19, 2011.

  1. Viswamitra

    Viswamitra IL Hall of Fame

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    Any person who wants to be successful in life needs to know money is one of the important resources given to us. It is my personal philosophy not to shy away saying money is important in life and I need it for my success. Having said that I am not suggesting that is the only important thing in life and I will use every opportunity to make money. For us to feel good about the money we possess, we need to earn it wisely with total sense of fulfillment. We also need to understand that power of money properly. For example, money cannot buy love.

    Next, mostly, we all find a way to earn money and support our family. Where we really face challenge is to protect our hard earned money. We have heard many stories of people who were very successful doing business and became millionaires have later become poor due to lack of skills to protect it. We also hear stories where lower or middle class families through excellent planning have raised their family financial status successfully. It is important to know that how to earn money is only 50% and protecting is another 50% of a family's financial management skill.

    The following factors are important to consider:

    1) We have to keep increasing our skills to enhance our earning potential so that we never become reduntant.
    2) We cannot assume our job or business earnings is good to support us forever. We need secondary income like interest, dividend, etc.
    3) We need to understand the difference between short term and long term debt. It is okay to have debts but should always have liquidity to immediately pay short term debts and have asset coverage and earning capacity to pay long term debts
    4) We need to recognize that we are not going to work for the rest of our life and hence income we are earning has two components i.e. for our immediate expenses and for our living expenses after retirement.
    5) We need to understand children's education is an important element in increasing the families financial status
    6) We need to have liquidity for running our family at least for six months at anytime. An emergency fund has to be set aside for unforeseen emergencies
    7) We need to have adequate life insurance to protect our family in our absence
    8) More than one person should know the details of all financial investments
    9) Always have your spouse as co-investor in everything (either or survivor) and your children as nominees.
     
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  2. Ooviya

    Ooviya Platinum IL'ite

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    Its really useful to all.. thanks for sharing..
     
  3. ProudIndian

    ProudIndian Gold IL'ite

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    Very good thread sir, I wish my husband understand this (protecting our saving is very imporatnt )
     
  4. Viswamitra

    Viswamitra IL Hall of Fame

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    Very kind of you to respond to this thread. Thank you.

    Viswa
     
  5. Viswamitra

    Viswamitra IL Hall of Fame

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    I am glad you liked it and thank you for your response.

    Viswa
     
  6. Madhumidha

    Madhumidha Gold IL'ite

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    Nice thread!!! Valuable information!!!
    Thnx for sharing!!!
     
  7. dipu81

    dipu81 Junior IL'ite

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    Very useful information. Thanks for sharing.
     
  8. nilasisu

    nilasisu Bronze IL'ite

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    hi mam,

    vey nice and useful information u have given to us.I have started doing retailing business thru MLM,till now i have had a kind of shyness to go and talk to people to retail the products.Give me some advice to do business.
     
  9. Viswamitra

    Viswamitra IL Hall of Fame

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    Thank you Madhumidha.

    Viswa
     
  10. Viswamitra

    Viswamitra IL Hall of Fame

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    Thank you for your feedback.

    Viswa
     

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