Skip to main content

How to build good relationship with money

 

We live in the real world, where life is not based on songs, but of dreams and goals that you want to fulfill.

A client of mine, when came to me for the first time, was bewildered regarding his financial situation. He knew that he wanted to realise and complete his goals and dreams, but was so sure that he did not have the right amount of resources to do so.

The first few minutes into the meeting he kept talking about how if he had a little more money, he would have been able to fulfil them sooner. After listening to him intently, I realised that it was not that he did not have enough resources to fulfil his dreams and goals, it was just he did not have the right relationship with them.

This is a common situation that is persistent in every household. At least one member in the family is unaware how to handle and maintain their finances.

Though not a very common practice, not many people know how to maintain a good long lasting relationship with their capital, in such a way that not only serves them in the present but also will help them accomplish their dreams and goals, without a glitch.

Altering your spending habits is the answer that you are looking for.


Analyse how you spend your money: Spending patterns often depends on one's moods or situations or events. Look at your credit card bills and analyse the same with the corresponding date and you will find out a pattern as to how you spend your money.
Spend but carefully: No financial planner would ever tell you not spend any money.
There are the basic needs that have to be fulfilled. Instead of splurging your resources on unnecessary items that you will use only once, find a non-expensive alternative that will not only fulfill that need but also make sure that you have not created a dent in your pockets. Reinforcing is the key: Psychologists often speak about negative and positive reinforcements in life that would help alter behavior of an individual. Try the same when it comes to your finances.

I started this project with a client who would spend money without a second thought. This was hampering one of the goals she wanted to achieve. To make her understand the importance of this, we set up a little project.

Every time she spent large amounts of resources on frivolous demands, her spouse would negatively reinforce her and would make her invest double the amount she spent, for a fixed period of time.

This enabled her to be careful as to where she spent her money, as she realised that there was a higher amount of resources going out then coming back in.

Look for alternative plans if you feel that your current plan is eating up too much into your savings. Your financial planner can help you get a simpler plan that will help you to invest less in a smaller amount of time, so that you don't have to face a financial crunch in your present.

Ignorance is not bliss when it comes to your debt situation: Try not to pile up your old bills and settle them as soon as possible. One folly that most people do is they collect and pay all their bills together.

This, at times, eats up a larger portion of your resources, as you may miss your bill date and end up paying more than the required amount.


Look for bargains that can help you financially: A well to do client of mine used to consider this to be a thrifty activity and never attended sales. I explained to him that bargains not helps you finds the best deals but also helps you to invest your resources in a better way.

The future of your money lies in your hands. Altering it and understanding it is the first step to a healthy financial life.

 

Popular posts from this blog

Bear markets may kill, but bulls always return with vengeance

Average Gain Between Any Two Downturns Has Been 186% IF you have lost a fortune in shares by now, the best way to make it up perhaps could be by buying some more. Since the Great Depression of 1929, the world has undergone 12 major bear market phases. The average bear market has lasted about 22 months, and the market has fallen by an average of 51%. However, the average gain during the bull market between any two downturns has been an eye-popping 186%. The index here in question is the S&P 500. Bull markets — after every recessionary phase — have always been good for investors. All major bull rallies since end-1930 have resulted in markets gaining between 50-500%. Historic numbers show that the magnitude (size or breadth) of a bull market is much heavier than that of a bear market. The million dollar question is: Are we at the threshold of another bull market rally? Markets could go up intermittently, but convincing rallies will take time to happen. The current bear phase is...

Stick to Good Fund Manager who Can Multiply Your Investment

A manager may be the difference between the best and worst funds. Here's how you can find the right one    Does a mutual fund manager make a difference to your investment? The answer may not be as easy as you think, since most best-performing mutual funds have moved away from individualistic fund management to process-driven methods, limiting the scope of an individual's role in investment decisions. In fact, many fund managers would speak at length about how the "system" their fund house has in place makes their task of picking stocks easy even though it restricts their freedom. Still, the question is important, especially after recent reports that the Securities and Exchange Board of India ( Sebi ) may ask fund managers to disclose to investors their track record of managing money. Let us take a look at the universe of large-cap funds over the past five years. According to Value Research, an independent mutual fund tracking firm, the topper in the category is DSP...

Tata Fixed Income Portfolio Fund dividend

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India)       Tata Mutual Fund has announced dividend under the dividend option of Tata Fixed Income Portfolio Scheme B2 Plan A-DQ, Tata Fixed Income Portfolio Scheme B2 Reg-DQ and Tata Fixed Income Portfolio Scheme B2 Direct-DQ. The record date has been fixed as August 29, 2013. Happy Investing!! We can help. Call 0 94 8300 8300 (India) Leave your comment with mail ID and we will answer them OR You can write back to us at PrajnaCapital [at] Gmail [dot] Com --------------------------------------------- Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C. Invest Tax Saving Mutual Funds Onlin...

NRIs and direct taxes code (DTC)

DTC Proposes To Do Away With Special Provision That Allows NRIs Liberalised Duration Of Stay In Country      THE new direct taxes code could bring a large number of global Indians under the tax net, as it does away with a provision that allowed individuals to escape tax in any country citing double tax avoidance.    The new legislation, introduced in Parliament on Monday, says an individual shall be a resident of India in any financial year if he is in the country for more than 59 days in that year, and has been has been India for more 365 days in four preceding financial years. A number of Indian industrialists including Vedanta's Anil Agarwal and Essar's Ravi Ruia have acquired non-resident status over the years.    The DTC has only attempted to clean up the provision in line with the laws globally. A phrase "being outside India" in the existing income tax law exempted individuals who stay outside the country for six months from paying taxes. This was prone ...

IDFC Classic Equity Fund

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India)   IDFC Classic Equity Fund IDFC Classic Equity is a large-cap equity fund which currently has assets under management worth Rs. 158.52 crore. It was launched in August 2005. The fund is benchmarked against the BSE-200 Index. Performance YTD 1-Year 3-Year 5-Year Since Inception IDFC Classic Equity 0.93 26.61 6.30 1.01 11.65 BSE 200 1.52 17.31 6.00 1.99 12.98 All figures in % as on January 31, 2013; Returns above one-year in CAGR terms ...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now