Author Archives: alvi

Savings and Investment Strategies

The secret to becoming rich is really quite simple.

First of all you must spend less than you earn – Then you must invest the difference.

But don’t stop there – You then need to re-invest the profits that your initial investment created as well as the original investment. In time this will create a big enough resource that you will be able to comfortably live of the income that your investments create.

Does this sound a little bit scary or like too much hard work? Well don’t worry because all you need to do is to create some savings and investment strategies and the rest will fall into place.

The first step is to create a Savings plan that works for you. When it comes to saving money there are generally two different types of people.

The first type are people who are somehow able to save money without any great difficulty. They have good restraint when it comes to purchases and they always have a sock full of money somewhere. When they are ordered around and given strict rules to abide by they tend to want to rebel and do the opposite.

The second type of person needs strict rules and regulations to achieve most things. Left to their own devices they would happily spend all their spare money on a new pair of jeans or car. When these people are given clear rules they seem to be able to save money with much more success.

Which type of person are you? Do you need strict Savings and Investment Strategies to save money or are you at your best when you are given more freedom. To be completely honest I think that everybody could become a better at saving money if they applied a few simple ideas.

One of the best savings and investment strategies that I have come across is this.

Reward Based Savings System

The first step of this system is to actually create a savings plan. For instance you need to focus on some areas in your life where you think you could save some money eg.

Bring your lunch from home
Quit smoking
Less alcohol from expensive bars
Cook your own meals
Public transport
Cut down on snacks

Isn’t it fumy how most of the things that I have just mentioned would be beneficial to your life in more ways than just saving you money? The problem is that all of the above things are actions and pastimes that you really enjoy.

So is it realistic to try and cut these activities out of your life and expect to be happy just because you are saving some money?

No, I don’t think it is. What about if every time you saved money you simply rewarded yourself? Then you might actually enjoy saving money rather than growing to resent it.

For example if you were to give up smoking then I would suggest that you keep a tally of the money that you are saving and use a portion of it to reward yourself with something that you love but don’t usually get, for instance a massage or a night at the movies. This way you are creating a savings plan that will actually work. Why? Because you want it to work so that you can get your rewards. Too many people create Savings and Investment strategies that don’t have inbuilt reward systems. The best thing about a reward based saving system is that you really enjoy the feeling of saving money. Then if you are smart enough to invest the extra money that you are saving you will have begum your journey towards financial freedom.

Important Tips for Savings and Investments

Below is a discussion of several important tips for savings and investments that can be considered when developing a saving plan.

Save Regularly

No matter how old a person is, it is important to put money toward saving and investing regularly, as the benefit of accumulated funds is one of the most important factors of wealth accumulation. Even if only a small amount of money can be set aside at a time, regular contributions to saving plans will grow over time and will result in the accumulation of funds. Additionally, many saving vehicles include the possibility of the benefit of compounded interest, which can translate into the growth of a saver’s contributions over time.


While saving cash is great, especially if the cash contributions are intended for a short term saving plan, it is important for the saver to consider several different saving vehicles. Saving plans available vary, but in order to take advantage of the many benefits available, diversifying with several different strategies is most desirable and may result in even greater saving. Each financial portfolio should include safe, conservative options for the security of funds, and more aggressive options for growth opportunity. Not every investment type is right for everyone. It is important for the saver to consider his or her risk tolerance and long term financial goals.

Take Advantage of Tax Benefits

There are many programs and benefits available that will reduce the amount of taxes that are paid on a saver’s income. The best advice is to seek out the investments and savings plans that offer the greatest tax benefits. Over time, these plans can result in great saving and lead to great financial growth.

Plan for the Long Term

Whether a person begins saving in the teenage years or as an adult nearing retirement age, the priority should be placed on a long term perspective. It is important that short term funds are available in case of emergency, but by committing to a disciplined approach to regular saving that is diversified and takes advantage of tax benefits, the funds will automatically be there in case of a financial emergency.

It can be challenging for families to find extra money to contribute to a saving or investment account. Living a lifestyle within, or even below, one’s means may be required to achieve financial independence. It is crucial, however, that a specific plan is in place for an individual’s financial security. Research into the many different options available should be conducted and it would be prudent to consult a financial professional for guidance.

By using the above tips, the average person can be confident that their money will grow over time and provide for his or her family needs. The most important tip, however, is to be disciplined and consistent. Only then can the greatest rewards be reaped

Saving and Investing – Two Entirely Different Things

Some people think of saving and investing as the same thing. That’s a big mistake. There’s a clear, vast difference between saving and investing, and knowing the difference may spell the difference between a comfortable and a troublesome financial life.

Simply put, saving is the manner of PRESERVING your wealth. Investing, on the other hand, is the manner of GROWING your wealth. It is important to both save and invest if you want to grow your wealth — simply doing only one of the two will put you in dire financial straits down the line.

When it comes to assets, we can loosely divide them into four categories:

#1 – Property, such as homes, works of art, etc. Property can have great value and be worth a lot of money when liquidated. But they’re not considered an investment. Why? Simply because you continue to use them while you’re alive.

#2 – Active investments are investments in which you take an active role in growing, such as the businesses you own and control. They’re called “active” because once you leave them alone, they’ll begin to dissolve and give you smaller returns.

#3 – Passive investments are investments that work on their own, such as stocks, bonds, and gold. When dealing with passive investments, it’s a good idea to diversify — meaning you should put your investments in many different places. Don’t risk putting all your eggs in one basket, so to speak.

#4 – Finally, there are your savings, which is your wealth that you store away. These are the things you’d like to keep to yourself — the bits of wealth you’d like easy access to.

It is good to have all these four categories covered when as you save and invest. They form the foundation of your financial life. If you truly want a build your wealth and provide for your family, you’ll do well to take the time to learn more about investing.