Money management rules for success - Posted by Dan Fink

Posted by Dan Fink on January 24, 1999 at 13:31:29:

1.First invest in your own education. This, no one can ever take away from you and it will pay dividends forever. In addition to being financially rewarding it is personally satisfying.

2.Buy the house or apartment in which you live. Paying rent to you is your best credit risk. Even in a down market you can get a good rate of return if you buy smart and are able to get a tax advantage.

3.Invest in your own business. Even if an S&P 500 company employs you, you can treat your employment relationship as a business in which you make an investment. A sideline business can also be a fun hobby.

4.After you have completed your education, bought your home and fully invested in your own business but still have excess cash to invest then start investing in assets related to your business or area of special expertise.

5.Asset allocation should be roughly: one third your own business: one-third liquid assets; and, one-third real estate and non-liquid assets.

6.Do not diversify beyond rules 1 through 5. Exceptional results come from specialization. If you spread yourself too thinly, you guarantee mediocrity.

7.Do not rely on the advice of experts. If you do not understand an investment, do not invest. Experts often have an agenda, which is inconsistent with your financial health. They often have a conflict of interest.

8.Keep good record so that you can review, measure and control your following all of the prior rules.

Hope this helps Dan Fink