How To Start Investing?

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How an ordinary Filipino can start investing even without sufficient knowledge or education about economics or business? By conscientiously following the five basic steps enumerated below, an average person can start his journey to financial freedom easily.

The Rat Race
Why many people with regular job doesn’t seem to get ahead in life? Its like every bit of money they have are just about right to survive. It is the rat race or going around in circles. How would an average Filipino prepare himself in becoming an investor to become worry free from financial struggles?

1. Live Below Your Means - It means, not spending money on things you don’t need.
If you can stay at home instead of partying on a Friday night with colleagues you’ll be way ahead of the game. Because the money you save can be used for investing. If you can postpone your kids who planned to get married, it’s the better. There’s no faster way to destroy ones financial future than to marry and have kids at a very young age. If you are financially free already, having kids and marrying the one you love can bring more joy than having to fight over money every month with your spouse.

2. Pay Yourself First - Your pay check every month is not your money. The electricity bill has part of it, food has part of it, your transportation has part of it and the government has part of it in a form of tax. Unless you save or pay yourself, you don’t have anything.

3. Pay off Your Debts - What’s the use of being free if you owe somebody? If you have credit cards, personal loans or salary loans, pay them first. You don’t want interest rates to be piling up every month. If you can, you may delay paying the others who doesn’t have interest in it. The idea is to be debt free as soon as possible.

4. Invest - The money you saved on #1 and #2 will be used for fighting inflation. As you know, money loses its value over time, what you want to do is to protect your money so it will beat inflation and brings about a decent amount of appreciation. Start investing in instruments and securities in the stock market and in mutual funds.

5. Read Books About Investing - If you have some money to spare, it is good to invest in knowledge first. Read about investing, money management and personal finance. Nothing can get you faster than knowing how to get there. If you can’t buy good books, then the best way to research is the internet. It costs less than a cup of coffee to have an hour of internet access.

Buy more shares on different stocks until you can see that the return of your money with your investments every month far exceeds your monthly income. By this time, you are financially free. Your dedication, patience and discipline have rewarded you with financial freedom. Now you have your money working for you and you are free to do anything. But don’t be overconfident. It takes a lot of patience to get to this stage and if you really want to be free you should know that only you can change your future. Not the government or God. I wouldn’t think God would waste a miracle on me or us ordinary people. So its up to us to make things happen, don’t you think?