Return on Investment – Is Your Money Really Working For You?

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The fact remains that in this life some people are constantly working for their money, while others have learned to put their money to work. Some people come off at the end of every month, saying; “I really don’t know what I did with that money,” or, “I can’t account for all the money I’ve received.” If you find yourself saying that, you can be sure you’re not in charge of your money; your money is in charge of you. It is determining what you do, where you do it, and how you do it. And you really don’t want that if you’re going to be putting that money to work for you.

There are a few pointers to knowing if your money is working for you or not, or if you’re getting any return on your investments;

  • Do you spend within a budget? – Every amount you earn should be assigned to a task, and accounted for. You should have your budget before the receipt of this money because cash is easier to spend when you have no plan beforehand. You should also have a scale of preference within your budget so you spend on those things most important first. A lot of the time savings is more important than some of our frivolous spending, so your savings should be somewhere close to the top of the scale.

  • Do you save with a goal in mind? – It’s important to have a goal every time you’re saving. It’s the money we save that can be used to purchase assets or invest in passive businesses that can bring returns/work to produce profit. Think more assets and less liabilities.
  • Are you in debt? – Being in debt is just the same as having an account in debit, so you’re not really making any money until you’re out of debt. Clear out your debt progressively, climb out of debit into credit, and begin to save and have your money do some work alongside you.
  • Do you have a reserve for emergencies or unforeseen circumstances? – This should be different from your regular savings. It keeps you from eating into your savings and procrastinating on your investment goals. It helps every time some unexpected but necessary expense comes up. It’s normal for expenses to grow and exceed income, but if we can discipline ourselves enough to regularly tie down a portion of this money and put it to work; financial freedom can become a reality.
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