If you are looking to start saving for the future, this article will guide you on the step-by-step procedures you need to take.
1. Create a budget
First, analyze your income and expenses, then create a budget that suits your needs. The 50-30-20 budget rule (https://blog.overwood.ng/index.php/2020/06/29/the-50-30-20-budget-rule-is-a-simple-way-to-manage-your-finances/) is a simple guide to manage your finances effectively. It states that 50% of your income should be spent on needs, 30% on wants, and 20% on savings and investments.
You can also decide to spend 50% on needs, 30% on savings and investments, and 20% on wants. Just ensure that you create a budget that suits your financial goal.
Make a list of all your expenses and itemize them in their different categories (needs, wants, and savings/investments). Then, stick to your budget.
2. Limit your expenses
If your expenses are extremely high, you will need to cut down on the excesses to enable you to save a little extra. Identify the non-essentials in your expenses and reduce the amount of money you spend on them.
3. Automate your savings
To keep your savings plan in check, it is advisable to automate your savings. This would help reduce the temptation to spend excessively.
4. Invest your savings in different asset classes
After saving a significant amount of money, the next step is to invest. Make sure to choose assets that suit your risk tolerance, and diversify your investment. Diversification is the best way to play the investment game. It will help minimize the risk of losing your funds while still earning good returns.
At Overwood, we invest pooled resources in mutual funds, government bonds, money market instruments, capital market instruments, credit-backed instruments, and treasury bills. However, our investments are weighted towards money market instruments and bonds, because we are safety-first. Start your investment journey with www.overewood.ng
and earn compound interest rates of 8 -15% per annum.
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