Traits of Rupee Manager

To give you an idea of how a rupee manager controls what they have, note which statements apply to you;

The Poor Rupee Manager

• Spends all their pay immediately.
  
• Must have it now, no matter how it hurts or how much credit they use
  
• Has no goals or plans other than to be rich and famous
  
• Follows the crowd and their friends
  
• Mixes with people who have similar money problems
  
• Believes they don’t need advice
  
• Has no interest in gaining financial knowledge
  
• Spends on items which lose value, e.g. Cars, stereos etc.
  

The Good Rupee Manager

• Saves a minimum of 10% out of each pay
  
• Minimizes borrowing for items which depreciate in value
  
• Has definite goals, e.g. 6-12 months, 5, 10 and 20 years
  
• Has a plan that they actually implement
  
• Mixes with people who are successful money manager
  
• Knows that strategic spending is a must
  
• Seeks professional advice and has a wealth coach
  
• Is keen to learn new things and ideas about money mangement
  
• Invests in items which gain in value by quality
  

Author: Greg Dempsey – Investor/Marketer
Title: Money Manager

http://www.OpulentWealth.com

Workable financial plan

I was busy with my personal life, so delay in posting. Today I am here with a workable financial plan (inspired from personal planning).
So the basics of a workable financial plan are

Identify what needs to be done. Where are you? and not where you want to be?

Define when you will reach the goal.

KIS/KIF Keep it Simple, Keep it Flexible.

Explore (in written form) possible paths to reach your goal.

Prioritize the activities along the path you have chosen to reach your goal.

Evaluate your plan. At least once a month track your progress on some visual medium.

Keep pushing toward the target date.

Close it out. Evaluate where your plan was successful. Indentify where your plan was not successful and make that the goal of your next plan.

Without a financial plan we have a tendancy to get too wrapped up in the present and we lose perspective of how to address what tomorrow may bring. If we intend to grow in any part of our personal or professional lives we must map (plan) what we want our future to look like.

For more articles, visit http://rupeemanager.blogspot.com

Setting financial goal

In a race, a person who runs a pre-defined length of space and in the shortest time, wins the race. Similarly, to find whether we have achieved our financial freedom, we need to set our financial goals.

Setting a financial goal is not like, I would like to have 10 Lakhs in my bank account by the time I become 25 or so. It has to be calibrated to the current economic situation and it is also linked to the life style we live in and many factors like inflation and stuff like that.

By achieve financial independence, I meant that I wont be working for money as such. So this means I should have sufficient money power (buying power) to lead the remaining of my life. Quite a big target.

Assuming current inflation rate to be 6%. What does it mean? An item which costs Rs100 today would cost Rs106 a year after. So the buying power of the money reduces. So to retain the buying power of our money, we should also make our money grow by atleast 6%. Not a big deal to get that kind of return. But if we do only this then we wont be able to build assets and also beome financially free. So we need a higher rate of interest. I would discuss this in other post.

So coming back to the point, we should define our financial goals like this:

1. Long Term goal
2. Short Term goal

Long Term goal is the amount of money which I would like to posses say after 10 years

Short Term goal is the amount which I would need in a short period of time, say 1 year to 4 year.

There would be many short term goals like buying a house, buying a car, buying a land etc... But only one long term goal.
So the only consideration for setting the financial goals is that the amount you set up for the long term goal should be sufficient to live the remaining life without giving up our lifestyle and the long term goal should not hamper our short term commitments.