How much to invest?

As a rule of thumb we (in the bank) say to our clients, they shouldn’t invest more than 30% of their paycheck. I say, it depends. It depends on several things.

  1. First, you’ve got to record what you are spending for several months: rent, food, bills, etc. So you can approximately plan what you’re spending monthly.
  2. Add 20% margin to it for unexpected stuff.
  3. The rest can be invested without fear.

Example: your paycheck is 3000. You spend monthly 1500. You can chip aside: 3000-1500*1.20=1200 -> some 40% of your paycheck.
Still, the money you have put aside for monthly spendings can still be “invested” in very secure products and can be used anytime. Just ask your financial advisor for “very conservative, but liquid products”. We offer a “money market” account that is almost like a checking account, but gives you some extra bucks a month.

Move your money, USE your money. It’s having good time right now in your checking account doing nothing. Make it WORK for you, damnit. Otherwise it will be slowly eaten up by the good ol’ inflation. Your bank will have a good profit from it… but will YOU?

Think about it.

December 2, 2006 | Filed Under Tips & Tricks 

Comments

Leave a Reply




 Share this page!