Getting smarter with your money need not take a lot of time. Here are 5 things you can do that take less than hour, but can impact how your money grows.
1. Subscribe to a finance blog
And No, the blog doesn’t have to be ours. There are quite a few options out there.
How does it help: We are not taught financial education as part of our school curriculum. How can you expect to really grow your wealth without knowing the basics of saving and investing?
2. Unlock the power of “72”
How does it help: Unless you know, what is your actual financial worth, how can you think of growing it? Add all your cash, FDs, Mutual Fund, Equity Holdings, and Saved Annual Income. Subtract from this all your debts. This is your financial net worth. Now use the rule of 72.
The rule of 72 states that if you divide 72 by the compounded annual rate of return, you get a rough estimate of when your money will double. So at 8% (what most debt instruments provide), your money will double in 9 years. But this is not considering inflation. If you want to grow your money faster and in a tax free manner, you might want to consider equity(12%-16%).
3. Mobilize unused money lying in your bank account and move it into a liquid mutual fund
How does it help: Most people fall in love with their bank balance once it starts approaching a “nice looking” figure. While a big balance looks nice, if you have more money sitting there than you need in a 3 month period, you are losing out on interest.
Move your unused cash into a liquid mutual fund to begin with, and then you can decide whether you want to invest in more long term instruments.
4. Repeat the above three steps for your family or close friends
How does it help: For most of us financial growth doesn’t happen in isolation. The way our family members grow wealth impacts us as well. Help out your family members and close friends figure out these money hacks and improve their relationship with their own money.
5. Use MOOCs to up-skill yourself
How does it help: The most effective way to grow your money, is increasing your salary. How much you make is dependent on, among other things, your experience and skills. While experience is something you can’t control, you can always learn new skills related to your work.
MOOCs or Massive open online courses are gaining popularity and acceptance among companies. These courses are often free or priced attractively. Finding and enrolling for a MOOC requires just one lunch break at work.