Before you can ever reduce your expenses and increase your savings, you must first know where your money is going to. Many people share the same experience of having no idea where their $5,000 salary went. 'How did I spend so much money?' 'I thought that I should have $1,000 left at the end of the month, but it seems to have all disappeared!'
With a simple yet powerful system which I personally use together with specially designed Microsoft Excel templates like the 'Monthly Personal Income Statements' and 'Daily Expense Sheets', you just need to invest fifteen minutes a day to manage your money.
If you want to be wealthy, do not expect it to happen automatically. You must commit to spend time on your finances. Earlier on in this book, I talked about the millionaire's daily hour. Millionaires spend an average of an hour a day on personal wealth management, while most people spend less than an hour a month, usually on paying bills.
So out of this one-hour a day, you've got to devote the first fifteen minutes to do these five Money Management Steps.
1) Always Ask for a Discount
If it is not a fixed price store, there is a 70% chance that you will get a discount if you just ask for it. If you get a 10% discount, it is equivalent to earning an immediate 10% return on your money. Over the long term, you will save a huge amount that will accelerate you even faster towards your targeted net worth.
2) Always Ask for a Receipt
Always get a receipt so that you can track every single expense at the end of the day and, if possible, claim it as a business expense and get a tax deduction.
3) At the End of the Day, Record all Expenses in your Daily Expense Sheet
You can do this manually in the sample 'Daily Expense Sheet 'at the end of the chapter or you can key it in electronically into a template.
I highly recommend you key it into an excel spreadsheet, so it can automatically add up the total each month.
4) Use a Credit Card Whenever You Can (but always pay the full outstanding sum every month)
Again, this will allow you a convenient way of having all your expenses recorded for you in the monthly statement.
5) At the End of the Month, Update Your Monthly Income Statement
At the end of every month, add up the total expenses from your daily expense sheet and update your monthly income statement. At the same time, update all your income for the month. Deduct your total expenses from your total income to get your monthly savings.
You must use a system to track where every single dollar goes. Only when you know where your money is going, can you take steps to channel it to your savings and investments.
Doing this month after month may seem tedious, but it is absolutely necessary if you want to build your wealth. Only when you develop the habit of managing your personal finances, can you manage the finances of your own business. So many people financially mismanage their businesses into bankruptcy because they mismanage their own finances. Don't be one of them!
Home Money Management Software
One difference between the previous card game scenario described in Part 2 of our Sports Handicapping And Money Management series and sports wagering is that while there was only one betting event at a time at the card table, there will quite often be multiple sports investment opportunities available at the same time.
After determining that 2-5% of current bankroll is the PRO INFO SPORTS "Peak Profit Percentage" to wager per event as detailed in "Sports Handicapping And Money Management - Part 3", we resolved the question of how many such events would be financially prudent to wager simultaneously. It was calculated that putting to work up to 25% of a bankroll at one time on a consistent basis offers the greatest potential for compounding profits without being unnecessarily risky if enough worthy investment opportunities are available.
Due to the sharp sports odds put up by the linesmakers, the majority of selections will be made from the lower half of the STAR RATING SYSTEM scale. We use this to our advantage by employing the multiple lower-rated selections as hedge investments against the few higher-rated selections and vice-versa. The Money Plays that risk a higher bankroll percentage are properly balanced by the more numerous lower-bankroll percentage investments. The following gaming analogy demonstrates the importance of such a strategy:
Don't Lose Your Marbles
Imagine 7 barrels, each containing 1000 marbles. The first barrel has 600 marbles marked "WINNER" and 400 marbles marked "LOSER". Each successive barrel has 10 fewer WINNER marbles and, thus, 10 more LOSER marbles. The last barrel would have a slimmest majority of WINNERS (540) and highest number of LOSERS (460).
As in sports handicapping and gaming, the object for a player is to win as much money as possible in the shortest amount of time by wagering on and selecting WINNER marbles.
To truly imitate wagering conditions we must also stipulate that the bettor is allowed incrementally more wagering chances with the barrels that contain a higher percentage of LOSERS. We can use the Peak Profit Percentage principle to determine what the proper bankroll wager would be for each of the barrels, which is what we have done with our STAR RATING SYSTEM; however, the question remains of how many bets to make on each barrel.
The proper PPP on the barrels with 60% WINNERS should be wagered as often as allowed by the rules; however, while there is a 60% chance that the first marble selected from that barrel will be a WINNER, there is also a corresponding 40% chance it will be a LOSER. If a total of only 10 marbles are allowed to be taken from the barrel, 60% of them "should" be WINNERS; however, 10 marbles out of 1000 is a scant 1% sample and any combination of WINNER and LOSER marbles is quite possible.
To increase the chances of drawing the same percentage of WINNERS as actually exist in any of the barrels, a higher number of marbles must be drawn. If the number of marbles allowed to be selected increase successively from the barrel with 60% WINNER marbles to the barrel with 54% WINNER marbles, so must the wagers. If 900 marbles are allowed to be selected from the barrel containing just 540 WINNER marbles, a winning advantage very close to 54% is nearly guaranteed.
The greedy bettor will "play the lottery" with only the few marbles he gets to select from the barrel with 60% WINNERS and hope he gets lucky with high bankroll bets. This is like a sports gaming investor who only plays a highest-rated play or 2 each week.
Meanwhile, the risk-adverse bettor will wager the minimal amount on all of the marbles and have to be satisfied with a very small profit. This is like a sports gaming investor who will only play a very small percentage of bankroll over many games each week.
The balanced investor will implement the best of both strategies, using the proper PPPs to make higher bankroll percentage wagers on a select few games and lower bankroll percentage wagers over a greater number of games.
This balanced investor stands the best chance of showing the biggest profit over the shortest amount of time because of the lower-rated selections acting as a hedge against the higher-rated selections and vice-versa in case one of them does not return a profit. Utilizing our Peak Profit Percentages and STAR RATING SYSTEM, this is precisely what the PRO INFO SPORTS Money Management strategy is designed to do, and why it is important for clients to invest in all recommended Money Plays at the recommended bankroll percentage.
We feature up to 10 Money Plays per investment "session". Some days we may even have more than one session, such as a Saturday with early, afternoon, and late college football and basketball games. As previously stated, on days with a very limited schedule, we try to at least offer an Opinion Selection with the usual comprehensive sports handicapping information, analysis, and advice if no investment opportunities are rated high enough to be a STAR SELECTION.
It must always be remembered that handicapping sports and wagering is to be approached In a professional manner. Sports handicappers and investors must be mentally and emotionally prepared for the ups and downs that will occur simply due to the laws of averages that are inherent with any type of investing. We are supremely confident that putting our Money Management strategy to work with our sports handicapping information, analysis, and advice will be a rewarding and enjoyable sports investment venture for those using our Sports Handicapping Services.
Both Adam Khoo & Jerry Fox are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Adam Khoo has sinced written about articles on various topics from Recreation and Sports, Web Development and Computers and The Internet. Adam Khoo is an entrepreneur, best-selling author and a self-made millionaire by the age of 26. Discover his million dollar secrets and claim your FREE bonus report 'Get Out Of The Rat Race Now' at. Adam Khoo's top article generates over 90500 views. Bookmark Adam Khoo to your Favourites.
Jerry Fox has sinced written about articles on various topics from Anger Control, Recreation and Sports and Fitness. Jerry Fox is an professional sports handicapper for ProInfoSports.com. Along with selling his premium expert sports picks. Jerry Fox's top article generates over 40500 views. Bookmark Jerry Fox to your Favourites.
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