Money Archives

Wealth Building and the Power of Compounding

How do you use the power of compounding to build wealth? Can a compounding investment strategy help with taxes? A passive investment approach utilizes the power of compounding to build wealth. You will earn interest on the money you originally invested plus on the interest you have accumulated. As the pool of money grows, your rate of returns will also grow exponentially. This strategy will also help with taxes because you only have to pay taxes once on the accumulated pool of money as opposed to paying each year and diluting the impact of your capital gains. Read on to

The 4 Common Investment Mistakes to Avoid

What are the four common investment mistakes? Why do investors fall prey to investment pitfalls? Common investment mistakes you must avoid include adopting overly complex investment models, listening to false oracles, combining companies with flawed synergies, and buying into companies that don’t expense stock options. The mistakes happen because of the competitive and profit-seeking nature of investors. The desire to get ahead and not lose out leads to avoidable and costly mistakes. Read on to discover more about the four common investment mistakes you must avoid.

Use a Passive Investment Strategy to Win Big

How a Passive Investment Strategy Wins Big

What is a passive investment strategy? Can passive investing outperform active trading? A passive investment strategy involves buying select securities and holding onto them for the long-term with the hope of extracting maximum returns and avoiding the fees involved in active trading. Most passive investors buy index funds that mirror the stock market to ensure diversification. Long-term studies show that passive investing has consistently outperformed active trading because very few people can truly exploit the imperfections in the market. Read on to learn more about the benefits of a passive investment strategy.

The Benefits (and Drawbacks) of Owning a Home

The Millionaire Next Door and Wealth Building

What are the benefits of owning a home? In a financial sense, how does renting compare to owning a house? According to David Bach, the author of The Automatic Millionaire, you’re more likely to build long-term wealth if you own your own home and accelerate your mortgage payments. Bach believes that renters are less able to build wealth because they’re funneling the majority of their money towards their rental expenses. In this article, we’ll first explore the benefits of owning your own home. Then, we’ll cover how you can get on the property ladder and automate your payments to pay off

Secrets of the Millionaire Mind: Quotes by T. Harv Eker

Are you looking for Secrets of the Millionaire Mind quotes by T. Harv Eker? What are some of the most noteworthy passages worth revisiting? In his book Secrets of the Millionaire Mind, author T. Harv Eker argues that the key difference between the (self-made) rich and the poor boils down to mentality. Specifically, he says that the way you have been conditioned to think about money in your childhood is the reason why you are where you are money-wise. Below is a selection of Secrets of the Millionaire Mind quotes by T. Harv Eker.

Compound Interest: Explained With Examples

What is compound interest? How does putting even a small amount of money into an account that accrues compound interest benefit your finances? Compound interest is the interest accrued on a loan or deposit. According to David Bach, the author of The Automatic Millionaire, everyone can leverage the power of the compound interest to start building wealth. While investing a few dollars itself won’t make you a millionaire, putting those dollars in an account that pays compound interest is much better than keeping them in a checking account. Keep reading below to learn about compound interest, explained with examples.

Financial Setpoint: Why the Poor Stay Poor

Why Socioeconomic Status and Depression Are Linked

What is the financial setpoint? Why do the poor stay poor and the rich stay rich? One of the main reasons poor people stay poor is because they lack money management skills. Even when a huge sum of money lands in their lap (e.g. through lottery or inheritance), people often end up broke within a few years. According to T. Harv Eker, the author of Secrets of the Millionaire Mind, the reason for this is their “financial setpoint.” Keep reading to learn how one’s financial setpoint—the amount of money they feel they can comfortably manage—keep poor people poor and rich

How to Invest for Retirement: Spread Your Risk

How many years do you have left until you hope to retire? Considering your age and the time you have until retirement, how would you balance your investment portfolio? According to David Bach, the author of The Automatic Millionaire, the key factors to consider when it comes to investing for retirement are how long you intend to invest your money for and how aggressively you want to invest. The younger you are, the more you can afford to take risks with your money because you have more time on your side. In this article, we’ll explain how to invest for

The 10 Signs That You Have a “Poor Mindset”

Are you tired of being a victim of your financial circumstances? What are the different ways you tend to sabotage your finances? According to T. Harv Eker, the author of Secrets of the Millionaire Mind, there are 10 negative tendencies that reinforce your belief that you’re powerless when it comes to money. Challenging these negative tendencies is the first step to eliminating them. In this article, we’ll help you to identify the specific thoughts and beliefs that discourage you from taking positive actions to improve your finances.

The Automatic Millionaire: Book Overview

What is The Automatic Millionaire about? What is the key premise behind Bach’s Automatic Millionaire process? In his book The Automatic Millionaire, David Bach provides a simple yet powerful plan to quickly grow and automate your finances. He argues that financial freedom doesn’t come from how much you earn, but how you manage your earnings—if you’re not saving your money with your current income, you’re unlikely to save it in the future. Here is a quick overview of the book’s key ideas.