Archive for ‘Money Management’

September 26, 2011

Get Out of Debt Trap

One often takes the route of debt to satisfy his/her needs when the needs are beyond his/her financial capacity. At that point of time s/he feels blessed but if this is not managed properly, this blessing turns out to be a curse and then s/he feels cheated and finds her/him caught in a trap of debts.

Various Forms of Debt

There are so many kinds of debt available in the market; formal as well as informal. You can borrow in such ways:

Credit Cards: These are the most risky debt available in the market. The cost of credit card loans ranges between 35%- 50% per annum. Use only when it is necessary.

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September 26, 2011

Money and Inflation

Money is a commodity that is in huge demand and needed by everyone in the society but in limited supply. Money is what that is needed to satisfy all needs this is able to buy what you want or wish for. This should be supplied consistently and in enough amount then only we can meet our needs timely and fully. But over the period of time the demand for money increases to satisfy those same needs. It may seem to be strange but this true. And more shocking truth is that everyone wants same to happen and governments support this.

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September 24, 2011

What is the Investment Risk?

As an investor you are always worried of the risk that is associated with your investment. You know that to earn some profits from the investments you have to take some risks but still you are always worried about it. The investment risk refers to the risk that is associated with any investment. All the investments are subjected to some kinds of risks that arise because of many reasons. The investment risk can be decreased by following some rules and strategies but cannot be eliminated at all. To invest into any financial instrument the investors has to ignore some investment risks.

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September 23, 2011

An Introduction to Finanacial Planning

All of us need money to spend today as well tomorrow so you too need money. You know how much you are earning today but are you certain that how much we will be earning tomorrow? Or are you sure how much money you will need tomorrow to satisfy some needs that will arise. You know how much you are spending today or you can spend but what about future expenditures? Do you know how much money you will be spending or you will need? And do you know where this money will come from? Is not this a question of importance?

I think this is important. Yes this is an important question for you not only you but everyone. You will have to face this question one day in your life. It is imperative for you to know what will be your financial needs as well as sources to satisfy those needs on a specified date. To achieve these two goals you need to have a financial plan because without a financial plan for maximum of people it is not possible to meet all the expenses. 

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September 23, 2011

A Vocabulary of Equities

Equities are one of the attractive investment avenues that an investor has an option to invest his/ her hard earned money. Equities provide huge returns. These returns are sometimes very high. But with these high returns the equities market is very risky and technical. There are so many terms related to the equities that you need to know as an investors that will help and guide in stint with the investments in equities.  These terms will you to understand the terminology of equity investments and market terms. These are as below:

Capital Gain (Loss): Capital gain or loss refers to the increase or decrease in the value of the shares. This is arrived at by getting the difference between the current value of the investment and invested money.

Consultation Fee: This is fee that is charged by the financial adviser upfront for rendering the consultation services. This has nothing to do with the broker or brokerage or stock exchanges.

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September 23, 2011

A Vocabulary of Bonds

Bonds are one of the safest investment avenues that an investor has an option to invest his/ her hard earned money. There are so many terms related to the bonds that you need to know as an investors that will help and guide in stint with the investments in bonds.  These terms will you to understand the terminology of bonds. These are as below:

Bond: Bonds are the financial instruments that provide investors fixed interests for fixed period and less risky investment option. Technically bonds are loans that are borrowed by the organizations from the investors for a promise of compensation in form of interest. Normally the bonds are long term investment instruments.

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September 22, 2011

A Glossary of Mutual Funds

Assets Management Company: It is a highly regulated organization registered under the regulations of the country that pools money from many people into portfolio structured to achieve certain objectives. Usually an AMC manages several funds –open ended/ close ended across several categories- growth, income, balanced.

Balanced Fund: It is a hybrid portfolio of stocks and bonds. This fund is structured according to the proposed objectives in the new fund offer statement. The aim of balanced funds is to provide both growth and regular income as such schemes invest both in equities and fixed income securities in the proportion indicated in their offer documents. They generally invest 40-60% in equity and debt instruments.

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September 20, 2011

5 Questions to Ask before Borrowing

It is quite normal that we have to borrow some money from our friends, relatives or banks/ lenders for various reasons at some stage of our life. Borrowing money is not a bad idea but it all depends for what purpose and how much money has been borrowed and how the money will be paid back.

Whenever you approach anyone; bank, financial house, lender, friends or family, they will ask to you many questions regarding the purpose of the borrowing and how you will pay back the loan. These people will also ask about other liabilities and your total income so that can assess your credit worthiness and your ability to pay back on time.

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