The Investor

Lovers of risk, anxious investors trade frequently and believe they have the edge over others. Many have absolutely no idea what their returns actually were and only remember their good decisions.

For hoarders, money represents security. They abhor risk and may even stockpile cash that they would probably be better off investing — or even spending.

Find an advisor you feel comfortable with who can discuss the right investment approach — and level of risk — for you.

The relationship protector is often family-oriented. If they can support them emotionally and financially, it gives them their sense of achievement at having helped. 

A relationship protector is far less likely to make spontaneous investments when others depend on them, and their conservative approach to saving prepares them for retirement. 

They’re always looking to expand their options, and every financial decision is carefully calculated to maximize growth. 

The opportunity seeker has to watch out for taking on more risk with business initiatives or investment opportunities. Spending time with a professional to seek a second opinion can help you assess whether the newest opportunity is the best one for you. 

After you have figured out your financial personality, here are a few tips to save money:

• Big Spenders need to consider fun alternatives to the high-purchases with things that cost little but bring real quality and happiness and lead to savings.
• Savers need to start living their lives, and not live in misery in the present, just for some future security.
• Shoppers need to recognise the emotions and value in saving money for their future, like a dream home.
• Debtors need to put some money in automatic saving funds to build their savings.
• Investors would do great in future, but can also make do with some purchases in the present, striking a balance.

• You’re probably depriving yourself of something, even if that’s just a cup of coffee now and then.
• If you're concerned about money, try to make more money by getting a side hustle.

By following the conventional path of "school to loan to university to work" you risk running into serious debt. Being creative is a potential way to lessen or eliminate that.

Maybe finding a different and cheaper way of doing the same thing, doing a yard sale or getting a side job… Put your mind to it and you may find ways to get a financial boost. 

When you buy mutual funds, you are charged a purchase fee upfront. This is a one-time payment to the fund management institution. Annually, you will be charged with a percentage of management fees, commonly known as “expense ratio”, which can be expensive.

Beware when advisors at your bank recommend mutual funds to buy. They might be earning a sales commission.

• A stock market is simply a place where buyers and sellers meet to sell shares.
• A share is a divided-up unit of the value of a company.
  
• Shares exist to boost profits of firms to turn a business into a financial success.
• Enter a stock market: in return for your cash, a business offers you a share in its future – so you essentially own a tiny slice of that company and become a 'shareholder'.
• This slice of the company you own can then be traded with anyone who wants to buy it.

• The price is initially set by the firm offering shares.
• Its price on any given day can be determined by poor financial results, the economic health and so-called 'sentiment', ie, if City buyers think a firm will struggle, its price can fall. 
• Shares are listed on an 'index'.

Banks don’t like to give away their money. That mindset is reflected in the interest rates of checking and savings accounts of 0,5% and 0.9% avg. annual interest respectively.

When you deposit your money in the bank, the bank turns around and invests that money at 7% a year or more. After they collect their profit, they give a tiny shaving of it to you.

• Your portfolio reflects your long-term wealth building investment strategy – not the short term. It includes everything you own. Your retirement accounts, your investment accounts, even your home are types of investments.
• Diversification is a way to describe owning multiple types of investment assets. Diversification is smart because you both protect yourself from failure and position yourself to take advantage of multiple robust methods for building wealth.

Over the long term, it's not as much about the dollar amount you save, but the percentage of your income that you dedicate to saving and investing. By focusing on percentages, you can ensure you're always saving more as you earn more. 

Most people react to their finances. The problem with that is that you rely on chance to have enough money in the bank when you actually need it. Be intentional about your money and spend time reviewing and evaluating it. If you don't, you'll never know if you're moving in the right direction or not.

• Create a full inventory of expenses in front of you: Categorize them into fixed and variable; urgent and non-urgent; necessities and luxury; avoidable and unavoidable.
• You can create a hierarchy of needs and decide which one’s to address first. It’s all about prioritizing. 
• Accept that you have limited resources and unlimited wants. But you have to manage your resources. The sooner you accept this fact, the better you can control your impulses towards avoidable expenditures.

It’s a statement wherein you can jot down your assets and liabilities.

• Pull together your bank statements and other proofs of the liabilities
• List down your assets like the bank balance, all investments, home value, and value of other assets.
• Take a sum of all the assets to arrive at the total value of your assets.
• List down your liabilities the (car loan, home loan, credit card balances etc.)
• The sum of all the liabilities will show the value of the money you owe.
• When you subtract the value of liabilities from assets, you get your Net Worth.