How To Make More Money, Part 3
In this series, I give tips that you immediately can implement to earn more money for this upcoming year.
• Evaluate your asset allocation and diversification strategy. This month, the Dow Jones crossed the 18,000 threshold for the first time in history.
This is a great time to rebalance your investment portfolio.
This means you should maintain the right mix and amount of each investment type. If you have a stock and bond mix in your portfolio and haven’t rebalanced this past year, chances are the stock portion of your portfolio has grown much faster than your bond portion.
By rebalancing, you get to lock in your gains and lower your risk!
• Know your financial number.
Do you know how much you need to save every year?
What is your financial number goal?
What level of investment return do you need?
Many people have no idea what their number is, and either don’t get started, save too little or save too much and don’t get to enjoy it! Create a financial plan so you know how much you need for financial security and financial independence. Visit artofthinkingsmart.com/plan for more information. You want to make the game winnable and realistic, so you can stay focused on your own goals, not someone else’s.
• Know what to do with your financial number!
What is the purpose of investing? Many people believe it is to grow your assets as much as possible. Actually, it should be to create as much income as possible. Assets won’t let you travel, buy food and other necessities.
I have clients who have spent years accumulating assets that are worth quite a bit, but unfortunately don’t produce income they need to live off of. Often, some investment assets are difficult to sell, which defeats the purpose of investing.
Create a lifetime income plan so you know how much and what you need to invest in to become financially free.
• Look to be educated, not just entertained.
The best investment you can make is in yourself. Learn from the very best investors how to apply those principles.
You will achieve financial freedom faster than any other way. Never stop your personal and professional growth.
Either you will master money or it will master you.
Visit artofthinkingsmart.com to learn the best tips for investing!