To be millionaire first you need to have your financial plan. You need to take help from Financial Planner, Tax Advisors, Real Estate broker, Lawyer to have your financial plan to make a Million.
Target Plan to become Millionaire
A target oriented financial plan for salaried person to become millionaire:
Age 30 No Passive income but you have cash generating good debt.
Age 35 You generate $1000 p.m. as passive income
Age 40 You generate $5000 p.m. as passive income
Age 45 You generate $10000 p.m. as passive income. This is financial freedom for salaried people .
At Age 55, $100000 p.m. You are super Investor
-MILLIONAIRE
you are millionaire in 25 years starting from no passive income using sound financial plan for portfolio management.
To become Millionaire, you need to follow sophisticated investment strategies for portfolio management.
1. Have an Business Idea to invent a product or a service which will able you to serve more and more people.
2. Do part time work to increase your cash flow
3. Increase your savings and guarantee it by following an automatic way .
4. Stop paying Rental by owning your own apartment. This also has tax benefit. Try to repay the home loan in 6 years.
5. Buy Term insurance for earned family member, auto insurance and home insurance
6. Invest regularly in no load Index fund.
7. Invest in Real Estate by taking home loan from Banks. This is leveraged style of investment using Other People Money.
8. Multiply yourself by forming a well informed team. You will leverage using other people time.
9. Invest in Future and Option market for Commodity.
Overall aim is to protect your capital and increase
cash flow by at least 15% year to year basis. This is called balanced portfolio
management
Initial Objective of this plan is to increase your passive income more than active income. This is called financial freedom . Once you achieve this, you need to gear up your investment strategy using judicious loan.
Secrets of Wise Investor
1. Your credit card bill is paid in full each month.
2. Inflation silently decreases value of money
3. Able to identify media buzz and hype from financial talk show and publication.
4. You know in real estate the worst house in the best neighborhood beats the
best house in the worst neighborhood.
5. Car loan is big NO! NO! . Do not take loan to buy liability.
6. You have a pretty good idea by mid-November how much your income tax
obligation for the current year will be.
7. Know tax law and your tax liability.
Debt is powerful tool to
Equity investment possibly can give you average post tax 15% return of investment for a period of 20 years. However, portfolio management with equity is very risky and volatile.
Moreover, you are investing your post tax salary in equity market. This amount is also limited.
If you take loan and invest in business or if you take home loan, you are benefited multiple ways.
As a leverage investor your capital is more. Hence your money will multiply in a faster way. Bank will take the fixed interest on the loan amount but the entire return will
increase your net cash flow.
Money is an finite quantity. You need to build it over time. Financial plan starts when you are in teen. You need to plan for your college education. There should be a proper financial plan to pay the debt for college education.
Advice on financial planning :-
Wealth Accumulation before marriage
Planning for Marriage
Divorce planning
Protect your Asset against any legal action
Advice on financial planning to new parents
Enjoy!!
Happy Investing !!
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