Ordinary income can produce extraordinary wealth with proper money management

We've all heard stories about ordinary people with mediocre jobs that spend their entire life living simple lives met and when they die, leaving millions to their heirs. It seems incredible that an ordinary person making $ 30 k a year might never become a millionaire. It seems incredible, because most of us earn and spend much more and still can not get, let alone save millions for retirement. Financial success can be achieved on any income if the expenditure is also properly handled. Too often we can't wait to get a promotion, because it means that we can now move to that new car or buy the boat that we've always wanted. Even without special shopping monthly expenses always seem to grow so fast that we can never move forward. If you feel that way, you're not alone. The majority of the population are walking the same hedonic treadmill that we perpetually need more to be happy. So what do we do? We're always adding more debt burden on our family and life in the pursuit of happiness but we never satiated. We then go back to our home, sit down and think about how good life is and how easy it would be to save for the future if we just had another revenue stream. There you sit around thinking about how good life would be if it only had one car less; but, ironically, for the average wage earner, wealth and happiness are made by reducing the costs rather than raise wages. Your best potential wealth can be calculated to determine your income and then subtract out the compulsory expenditure. In a nutshell, if you make $ 5000 per month, but compulsory expenditure is $ 4000 per month, have a maximum potential wealth of $ 1000 per month. If fill that $ 1000 per month with more discretionary purchases, your wealth building potential declines exponentially. If you want to create more long-term wealth, the only money you will be able to build with the money left over after all expenses have been paid. You can improve that number either by cutting discretionary spending or restructuring of compulsory expenditure. If you have $ 1000 to discretionary spending left at the end of each month, but somehow manage to spend every penny by the end of the month, then you should probably pass $ 500 earlier this month to an account not accessible. Chances are that magically you only spend $ 500 a month of discretionary spending, simply because we adapt to our environment and if the environment is only $ 500 in it, we will adapt. If you want to save more discretionary cuts can afford, then it may be time to address the compulsory expenditure. How easily we forget discretionary spending may become compulsory. While the satellite is seen as a discretionary expense, is actually a compulsory expenditure because you probably are forced to a 2-year agreement and you will probably want your TV. Even your House is a compulsory expenditure. These two compulsory share one important thing you've bought probably more than I should have been happy, but once you make that decision, you are stuck! Unpack the compulsory expenditure is much more time consuming and difficult than unraveling discretionary spending, but the good news is that, when you make changes to your compulsory expenditure, can have a dramatic effect on your savings (if done correctly). The key is that every time you reveal a compulsory expenditure, the amount saved will be channeled into a savings or investment account before they can be withdrawn from the "discretionary" spendmonger. If you have $ 500 per month to be sent to an investment account, on the same day that you save $ 20 on a new satellite TV deal is on the same day, change your automatic savings plan from $ 500 per month to $ 520 per month. How to reduce discretionary spending and required every month, will increase your potential for wealth generation. This means that you can become a millionaire on any income, but you have to make the decision to get off the hedonic treadmill and you have to make saving automatic.

Poverty to profit: Islamic microfinance – part 2

ISLAMIC MICROFINANCE WORKS AS The provision of Islamic microfinance Mudarabah contract falls under, a participatory agreement in which one party provides the capital (main) and the other (the worker) is used for commercial purposes, in which the profit from the trade is shared according to an agreed proportion and the loss, if any, unless caused by negligence or breach of contract by the worker, is confirmed by the principal. Here are some considerations: >> The main Bank should not interfere in routine operations of the activity of the worker, even if the Bank is permitted to provide technical advice. The worker must provide regular periodic reports to activity State Bank; >> Profit earned by a business Mudarabah is distributed among client and worker on the basis of proportion settled in advance; >> No fixed amount as profit, salary or Commission, could be dismissed in favor of the parties in advance; Islam permits, establishing the profit in percentage terms (e.g. "10% of share your profits with me every month"), but prohibits the fixing profits in absolute terms (such as "give me $ 100 of your monthly profits"), the obvious difference is that the former is linked to business performance, whereas the latter is plugged into anything; >> In a business running, losses can be compensated with business earnings until the business closes and accounts are paid; >> scholar of qualified Sharia should be consulted throughout the investment process to ensure that transactions are in accordance with Islamic law. A Grameen model Islamicized version looks like this: 1. a group of 5 customers the approach an Islamic Bank microfinance investment capital to 5 separate projects. 2. After the feasibility evaluation for each of the 5 projects, the Bank shall draw up separate agreements, explaining the reimbursement schedules and profit-sharing percentages and pointing out the possibility of more investment in the future depending on their individual performance. 3. the Bank invests primarily in 2 individuals. 4. these first 2 individuals repay a quarter of each of their original investments each week for four weeks (scratching your profits in the field each week) until the end of the month that is paid back the entire original investment and 75% of all the profits remain with the individual and 25% of the profits return to the Bank (mainly to finance growth and future Bank operations); in the event of leaks, only what's left of the investment is repaid. 5. in the second month, the Bank then evaluates the performance of these first 2 individuals and decides whether to reinvest; growing investment size for those individuals with higher return rates to 10%; keeping the size of existing investment for those individuals with rates of return between 0% and 10%; and reducing investment for loss of individuals, where a second round of losses would disqualify them from any future investment, forcing the remaining group to find another partner of the group. 6. Also in the second month, the Bank started investment in next 2 individuals, using the same rebate program and profit-sharing agreement with regard to the first 2 individuals. 7. in the third month, the Bank assesses the performance of 4 existing customers and decide whether to reinvest, using the same criteria. 8. Also in the third month, the Bank invests in the fifth and final single of the group, using the same rebate program and profit-sharing agreement with regard to the previous 4 individuals. 9. the Bank continues this transaction cycle, using the same rebate program, the profit-sharing agreement and reinvestment policy for all future investments. These simple steps are effective in a rural village in a Muslim country like in an urban ghetto in a non-Muslim, if the client is male or female, young or old, Muslim or not. Size groups, repayment plans, the goals of profit-ability, reinvestment policy, investment duration and other integrals of the transaction can be customized to meet the needs of the customer as necessary. In calculating profit, the client must provide only three kinds of information: purchase price, selling price and quantity purchased. It is fundamental that from the beginning, customers explained that profitability (and, implicitly, by declaring honestly profits) translates into more investment in the future.

Guaranteed interest-are you looking for a safe place for your money?

So you're worried of interest on fixed deposits and guaranteed bonds, right? The law says that once you've purchased bonds, or fixed deposits, interest rates in force at the time of purchase will remain blocked until it expires. Unless the Government is necessary to change interest rates, the money earns interest guaranteed for the entire period. While this remains the safest form of investment for the common American, there are some specific characteristics that must be met before you can earn your interest. Say for example, the inflation rate of 5% standard today were found to earn that interest you would need to invest a minimum of $ 100,000. First, the $ 100,000 capital is locked for the duration of the term of deposit. Banks can enable a first flush but the penalties are heavy. What would happen if you didn't have the $ 100,000 to begin with? At most you could gather all of your savings and total on a modest $ 90,000. This means that to catch up with that would be the minimum to earn 5% inflation rate, now you would be able to earn only around 4%. This means they are financing part of the cost of the interest from their earnings. Honestly, it has been seen that the Government only has tax benefits in mind while asking people to invest in bonds and Treasury notes. Your guaranteed interest from these bonds never exceeds the 2%. This in today's economy means that you bear the burden of inflation virtually alike. Anyone would think twice about blocking of his or her hard-earned gains in these low-return instruments. The obvious question that still haunts the American town is ' we have something which we guaranteed to interest out of bank deposits and Government bonds can earn? ' The answer is Yes. There's the cash value life insurance that can provide the solution to this embarrassing problem today. Smart people smart choices. Think long-term. That's why you see the benefits in their own way. Everyone wants a quiet life after retirement not extended hours of work beyond the retirement age. Why do people do? As you know most Americans, they are pretty much left to dry by credit debts and bill payments. No retirement period left for the post, I'm still percussion; earn beyond their working age. There are various cash value life insurance, which guarantees that the cash value of life insurance is growing at a faster rate while at the same time it pays dividends. The money stays safe, not only goes to open a door to passive income for life. Now provide for the college education of children and take that vacation long wanted-all while ensuring you earn guaranteed interest you were looking for in conventional stores.