The IMPORTANT part
The IMPORTANT part. Reread this often:
I know all of you want to learn about investing and making money in the market, but I'm telling you this below is the important part now. ...............repeat after me: 5% of zero is zero, 8 % of zero is still zero. And 20% of zero YES, is still zero.
The first step is to promise yourself you will always have a budget. The next step is to commit to be saving for retirement now. Yes, now. You will be a millionaire if you invest 10-15% of what you earn per week into the stock market. EVERY week. The easiest way to do that is to have two separate checking accounts. One (called household) is for bills that you don't have much control over, example: Savings, phone, electric, rent, car payment, car insurance, plates for car, car repairs etc. The other is for credit cards, ( which I highly recommend you don't use unless you make payment before you use the card or debit card) food, beer, partying, gas, restaurants, clothes, gifts etc. You compute what the bills are per week and deposit that total amount into household acct. every week, so if car insurance is $520 a yr. then you deposit $10 a week into household acct. This sound like a pain, but it isn't as you would only compute this a few times a yr. once you came up with what the weekly figure needed to be. Best way to deposit is "direct deposit" if where you work offers this option.
IF IT'S NOT AUTOMATIC IT WON'T WORK.
After the correct amount is deposited into household acct., the balance goes into the other acct. The rules are simple, you can only write checks out of household acct. for the items that you listed as weekly deposit items. No excuses to yourself. In the other acct. the only rule is don't bounce a check.
The important part is the mental attitude. For example "what if I don't have enough money in the other checking acct. to go out with friends for drinks and dinner," then stay home and eat spaghetti. ( because you should have saved for this) No, not take out spaghetti from your favorite restaurant, the box you bought on sale at the Supermarket. :)Now I have a question for you: do you think the guy that closed his IRA yesterday was following the above advice on "household acct"???
I know all of you want to learn about investing and making money in the market, but I'm telling you this below is the important part now. ...............repeat after me: 5% of zero is zero, 8 % of zero is still zero. And 20% of zero YES, is still zero.
The first step is to promise yourself you will always have a budget. The next step is to commit to be saving for retirement now. Yes, now. You will be a millionaire if you invest 10-15% of what you earn per week into the stock market. EVERY week. The easiest way to do that is to have two separate checking accounts. One (called household) is for bills that you don't have much control over, example: Savings, phone, electric, rent, car payment, car insurance, plates for car, car repairs etc. The other is for credit cards, ( which I highly recommend you don't use unless you make payment before you use the card or debit card) food, beer, partying, gas, restaurants, clothes, gifts etc. You compute what the bills are per week and deposit that total amount into household acct. every week, so if car insurance is $520 a yr. then you deposit $10 a week into household acct. This sound like a pain, but it isn't as you would only compute this a few times a yr. once you came up with what the weekly figure needed to be. Best way to deposit is "direct deposit" if where you work offers this option.
IF IT'S NOT AUTOMATIC IT WON'T WORK.
After the correct amount is deposited into household acct., the balance goes into the other acct. The rules are simple, you can only write checks out of household acct. for the items that you listed as weekly deposit items. No excuses to yourself. In the other acct. the only rule is don't bounce a check.
The important part is the mental attitude. For example "what if I don't have enough money in the other checking acct. to go out with friends for drinks and dinner," then stay home and eat spaghetti. ( because you should have saved for this) No, not take out spaghetti from your favorite restaurant, the box you bought on sale at the Supermarket. :)Now I have a question for you: do you think the guy that closed his IRA yesterday was following the above advice on "household acct"???
posted by MoneyProf at Sunday, March 20, 2005
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