We all have bought something and later came to realize that it is actually of little benefit. The desire to fit in a given social class, competition to “keep up with the Joneses” and addiction are some of the drives that lead us into wasting money. A person may decide to buy the latest product on the market to keep up with the trend. You just landed a promotion and the first thing you think of is securing a mortgage for that dream home you had. In another instance, your friend John who works at the fast food stores at the gas station wants you to go for a ride every weekend downtown.

After some time, you begin to think of investment but you realize you have little income to drive you. Suddenly an eye-opener comes and you start seeing leakages from your income statement. That expensive watch that you rarely ware, the house you do not even have time to stay in or the numerous trip journeys that you could have avoided. This article b seeks to address money leakages that most people encounter. Below are some of the money consuming substances that one needs to avoid.

 

An investment is an asset acquired with the intention of future appreciation. Activities associated with financial investment include real estate investment, purchasing bonds, stock acquisition, etc. An investment can be autonomous or induced in nature. Whereas the induced investment depends on income, autonomous investment is dependent on an exogenous function like population growth. Investment can be made by private members in the economy (private investment) or by the government and another public enterprise (public investment).

The benefit that comes from the investment is known as a return. In finance, the return comes in the form of a capital gain, share dividend, interest on bonds or even income. To project expected future benefit for investment, financial accountants use the projected amount in the valuation. Some of the determinants of investments include interest rates, internal rate of return, expected future flow of income, the initial cost of capital and the degree of certainty.

Before an investor makes a decision on whether to focus on a given portfolio, they need to take cognizance of certain factors.

Below are six useful tricks when planning for investment