hi friends welcome to dushara & deepawali

Money can make many things and also it can make monkey things. It all depends how well you will utilize it.

Old or young, male or female, regardless of education, talent or qualifications. There are just few steps to take you
from zero to well over
a million dollars and each step is to be discussed in this section every week. Money is volatile.

1. Save 10 cents from every R1 you earn. If you put away at least 10 percent of your income as part of a long-term
savings plan, there is a
good chance that you will have a financially secure future and be able to attain your financial goals.

2. Put 10 percent of every pay increase towards savings, particularly long-term savings such as a retirement plan.
If you are employed
and belong to a retirement fund, your contributions will increase automatically in proportion to your pay rises. This
will help ensure that
you stay well ahead of inflation.

3. Use the “Can I sleep?” judgment when making investments. An investment is too risky if you are going to lie
awake at night worrying
about it.

4. Diversify your investments. Never invest more than five percent of your assets in a narrow investment (for
example, a specialist unit
trust fund such as an emerging company one) or in an unregulated investment. Diversifying your investments will
ensure you don’t lose
everything if one investment bombs out. Many people who invested all their assets in major scams such as
Masterbond lost everything,
and the same thing can happen in the regulated market if you put all your money into one sector ... just consider
how the information
technology bubble burst in 2000.

5. Be extremely cautious if the returns promised on an investment exceed what is generally available. If they sound
too good to be true,
they probably are. It usually means the investment is too ambitious in its claims, too risky, or simply a scam.

6. Know the difference between effective and nominal interest rates. Normally, banks will quote you a nominal
interest rate when lending
you money, but a higher, effective interest rate when you invest money. The nominal interest rate is the simple
rate. The effective rate is
calculated by compounding the interest earned or charged.

7. Check whether the interest you are being paid is credited monthly, quarterly or annually. Say you invest R10
000 for 10 years. If you
receive interest at 10 percent credited annually, you will get a total return of R25 937. If it is credited monthly, you
will receive R27 070.

8. How do you decide whether you should invest directly in shares? Simple. If you haven’t got the time to learn
about stock markets, to
follow the progress of companies or to track your portfolio, rather invest in unit trust funds and/or life assurance
endowment policies that
have shares as their underlying investments.

9. If you do invest directly in shares, your two most important considerations should be ensuring that you have a
properly diversified
selection of shares across the stock market sectors to reduce risk, and regularly rebalancing your portfolio. When
a share rises in price,
you should consider selling some, but not all, of these shares, so that you make a profit, but your overall portfolio
remains proportionally
the same as it was when you started. By doing this, you’ll be able to reap further profits if the share price continues
to rise.

10. If an investment product is too complicated to understand, avoid it. It does not mean you are stupid. It simply
means that the product
provider and/or financial adviser are trying to baffle you.

11. Always check the costs of any investment product. Some products are prohibitively expensive. You should be
given a breakdown of
the costs in three ways: as a percentage of your investment; as a fixed amount; and as the amount by which the
costs will reduce your
investment at maturity date. Be very careful if the costs are more than six percent at entry and more than two
percent a year thereafter.

12. Always check how much commission is being paid to your financial adviser. Some financial products –
particularly those offered by
so-called linked investment product providers – come with particularly high costs and commissions. High
commissions can be a
perverse incentive for advisers to mis-sell.

13. A product offering a range of underlying investment product choices, such as a wide collection of unit trust
funds, is often not in your
best interests and may come at additional cost. Be very cautious if anyone recommends that you invest in a linked
investment product
with a wide selection of underlying investment choices. Remember that linked investment products come in many
forms and are also
offered by life assurance companies. The simpler and cheaper solution may be to invest in a properly diversified
unit trust fund, such as
an asset allocation fund that offers underlying investments in all the main asset classes, such as cash, bonds and
shares.

14. Don’t be afraid to negotiate commissions/fees for financial advice. Most financial products allow you to do this.
After all, it is your
money.

15. If you have a choice, should you pay a fee or commission for financial advice? As a general rule, a fee is better
for large amounts of
money and a commission for smaller amounts.

16. If you are a true investor, you invest for the long term and you don’t panic when markets fall. If you want to
invest for the short term, you
should use a bank term deposit or a money market account rather than an investment in the equity markets.

17. It is time in the market and not timing the market that counts. Don’t try to time markets or sectors of markets.
Few people have got
rich from doing this and most have lost money. The best way to get rich is to take time to select an investment
product that has properly
diversified underlying investments, and then to stick with it for the long term. Most people make the fundamental
error of buying into an
investment when it is at the peak of its performance and then selling out when its value has dropped.

18. Always check that an investment product and/or company is registered with the Financial Services Board