This week's tip is brought to us by Ray Wright.

Types of Investing

There are so many places that you can put your money that the entire subject of investing can be a bit overwhelming. I believe in a slow economy one of the best places that you can invest is in your debts. This is one area that offers a guaranteed rate of return. For example, if you had a debt that was charging you 31 percent interest the banks are collecting the interest. Once that debt is paid off then where does that 31 percent go? The answer is that the 31 percent goes in your pocket. So before I get into the different types of investing I want everyone to be clear on this point. You can get a guaranteed rate of return by “investing” in your debts and you cannot get a guaranteed return in the stock market.
You can put you money in a savings account. This is a good option if you do not want to earn a lot of interest. A popular place to put emergency funds is in a money market account. If you are looking for a money market account you can Google high yield money market and you can do some research and decide what investment is the best for you. You can invest in the stock market. For most people the best way to get involved with the marked is through mutual funds. Mutual funds are low cost investments that help beginners diversify their investments. You can invest in stock. This is an option for more experienced investors. Stock is ownership in a company. The whole name of the game with any investment is to buy low and sell high. Or another way to put it is to buy high and sell even higher! Bonds are another type of investment. A bond is a loan that you give to a company. The company promises to pay the money back to you with interest. Real Estate is another popular investment. There are many people that are running from the real estate market while the real estate gurus are claiming that it is a great time to buy. Remember the whole name of the game is to buy low and sell high. Wherever you invest your money make sure that you do your homework and that you are fully aware of what you are investing in. And stay away from the investments that promise impossible return!

This week Lorin shares another great testimonial about the success of the financial coaching program.

In today’s society so many people get caught up in the “Jones’ trap.” They feel they need to have the latest widget or gadget. If you find yourself caught up in this trap that leads to poverty, there are some things that you can do to overcome this type of mentality.

Step 1: is to have a financial vision of where you see yourself financially in the future. This is the first step to overcoming the impulse of buy. I have this as the first step because I believe that you should always start your goals with the end in mind. If you do not know where you want to be with your finances then it does not matter what you do with your money today. When you have a plan for the future the small steps you take towards your end goal start to mean something to you.

Step 2: is to make sure that you always distinguish between the needs and your wants ask yourself “do I really NEED this,” before you buy anything! Keep a small journal and write down your thoughts and feelings. Get to the bottom of why you feel you need to impulse buy. Is it so you can feel better about yourself is it so you can appear to be wealthy to your neighbor? Why do you buy what you buy? Recruit a friend or family member. If you have been trying to overcome impulse buying on your own and it has not worked for you then recruit a friend or a family member to help hold you accountable for the things that you spend your money on. This may be hard for some of you to accept that you need help from someone else but, having an outside force helping you will do wonders for your finances.

Step 3: Increase your knowledge when it comes to your personal finances. There is a lot of information out there for those who are willing to use their library cards. Use you card and look up the subject on personal finances. There are a few personal finance books that I highly recommend. The Millionaire Door is a great one and if you have never read a book on personal finance I would start here.

Step 4: Get rid of the temptation to buy. If you weakness is QVC and ordering things on the TV then, turn off the TV and find a new hobby. If you were an alcoholic and you were trying to stop drinking would you hang out at a bar? The answer to that is obviously not. Then why would you hang out where your weaknesses are?

Following these steps will definitely help but the only way to fully benefit from the things that I have said today is to take ACTION! Without taking action the things you know matter less and less. Decide today that you are going to take control of your financial future and that you are going to stop trying to keep up with Mr. Jones!

This week Lorin shares another inspiring testimonial from our students.

It seems like everywhere we turn we are hearing about more layoffs and foreclosures. The ripple effect that the housing market is having on the overall economy has been extraordinary. What does this mean for you and your finances? When it comes to real-estate a lot of things have changed. One of the main differences is that banks are a lot more conservative with the money that they lend out. What this mean to you is it may be harder to get a loan. You may be required to put at least 10 percent down and have an excellent credit score before banks will lend to you. A few years ago all you had to do was have a heartbeat and you could pretty much get the type of loan you want. Credit is harder to come by and this is one of the major reasons the real estate market has slow down. I believe it could take years before real estate prices return to their previous levels.
Yes, the economy is not so good at the moment but we should not use this as an excuse not to succeed with our personal finances. We must accept that the economy is not at its peak but that does not mean that we cannot thrive with our own personal economy. What it does mean is that you may need to be creative with your income. Focusing on one or two streams of income is not good enough anymore, it is time to have multiple streams of income. If one stream goes away you are still on track to accomplishing our financial goals because of the other streams you have in place. The plan of action should be to accept that the US economy is not doing so well but do not use this as an excuse and begin the process of finding multiple streams of income!

This week Michael Sites delivers an update on the current outlook for the future of the economy.