How To Get Your Money Together

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This post could easily be titled “How to Invest your Money”, but this is not about investing in the commonly referred to sense. This has nothing to do with stocks, bonds, or real estate.( In the future I will post about that)

For now, you may be in the position that you think you could not invest any money. You may not have enough to get by as it is. Today I will clue you in on the first step to freedom. I will give you the first tool to use that will dramatically influence your money situation. Later, we will talk about how to put that money to work.

The very first thing you need to know in investing your money is how to get the most “utility” from the money that you currently have. What does that mean?, you may ask. Simple. It means that you are directly responsible as a personal investor to gain every bit of value out of every dollar that you currently possess.  This has nothing to do with being cheap or a tightwad, but has everything to do with gaining the most bang for your buck, or utility.

A classic example is housing. Most financial advisors will tell you to buy all of the house you can afford. This is not optimal. What if you can afford a million dollar mansion in an exclusive neighborhood, but you live alone, or with one other person. This may make you feel wasteful that there is more space in the house than you can occupy. Not to mention the huge payment

The solution to this is to buy as much house as you need. If you live alone, you may not need more than a nice apartment. I personally get satisfaction out of owning a home, which I am free to do whatever I want with. Housing updates, maintenance, and yard work are my ideas of a good time. For some, this is not and it would be good use of funds to buy something different. There is no need to overextend yourself if you do not have to.

To illustrate the value of possessing skills, I can tell you that when it comes to housing amenities, replacement, and upgrades, I can live in a house fit for a king for a fraction of the cost everyone else pays. How?, you ask. Simple. I do the work myself.

The average script for a homeowner looking to upgrade their home is this: They wan to say, remodel their kitchen. They may or may not know what they want to do. They may hire a designer to do this for them. Then they hire a contractor, who will charge them just for an estimate. Then the contractor will get the job, buy the materials at cost, then raise the materials cost by AT LEAST 2%. Then you pay the contractor to do the work. you may also have to pay for an electrician and a plumber if your remodel entails any fixtures or lighting.

So, what if you have no knowledge or skills to do these things yourself? You guessed it. Get to learning some skills. There are free resources everywhere on the internet and the local library. A little bit of study time, and you are on your way to developing a new skillset.

Vehicles can be put into the classification of needless spending because most people buy cars that they cannot afford, and they buy them on credit. A word of warning, DO NOT DO THIS! Buying an overpriced car on an auto loan, or even worse, a lease is the worst possible thing you can do. Nothing like paying monthly rent to drive around town.

If you do some research, you will find that you can find a very well built, dependable, maintained used vehicle for a fraction of the showroom price. I currently purchase one used vehicle no less than once a decade. I have had my current for over ten years and it has plenty of life left for a few more. If something breaks and needs fixed, its not a problem because the upkeep is much less than a monthly payment for five years. So do yourself a favor and go find a reliable used vehicle and put your monthly payment in the bank.

Everyone keeps complaining of food, gas, and clothing prices going up and up, but there is a way to offset the cost and still eat well. For example, about every four months I go to a local store called Cash & Carry(check your area for availability). There I buy my meat and other bulk items. If you do not have a similar store near you, use Costco. A Costco membership is less than $100.00/year and can save you a lot on items that you normally purchase anyway. You will be buying in bulk, so make sure to get storage containers and freezer bags. The cost savings on meat alone at Costco and Cash & Carry is enormous. Make sure to take full advantage of these stores and stock up on your every day purchases.

Another great way to buy bulk items is through Amazon. Amazon has numerous deals and membership clubs to get the most out of them. Do you like streaming movies and TV shows? Try Amazon Prime  Love reading books? Try Kindle Unlimited . Want to get deals on food items? Try Amazon Pantry (part of the Prime membership)

As you can see, it takes just a little thought an research to save some cash and build up some cashflow. There are numerous areas where you can slash prices on everything you normally buy. Housing, cars, and groceries are the big ones that will provide the most bang for your buck.

Next time we will discuss what to do with the surplus money, and ways to invest it for even more return. Until then, start with the big ticket items that everyone seems to miss the boat on.

Rise up and stay strong!!

Jeff

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