The month of November was big on finance tips. We talked about whether savings can make you rich or not, emergency funds, investment mistakes by beginners and the mother of sales – Black Friday. Jump in below for the full gist.
Can a savings account make you rich? – Bondora
Getting rich is a financial goal for almost everyone. But will your bank savings account help you achieve it?
Chances are you’ve had a bank savings account at some point in your life. It’s convenient to open, easy to deposit money into, and you can withdraw your money whenever you like. But the downside of a bank savings account is the low-interest rate. Currently, you’ll be lucky if you get a return rate of more than 1.5%.
So although the convenience of a bank account is nice, the price you pay is having your money grow very slowly. And if you take the rate of inflation into account, your money won’t grow, it will simply remain the same – which won’t make you rich.
Luckily, there are other ways to make more money. By investing in assets that will pay you more, you can let your money work for you effectively.
So if your goal is getting rich, then search for investment options that provide higher earnings for you. Read more about this topic in our blog post.
The top 3 things you need to know about emergency funds – Bondora
If 2020 has taught us anything, it’s that you should always have an emergency fund. Here are our top 3 things you need to know about emergency funds:
1. It really is necessary
No matter what your financial situation is, it’s essential that you put some money away for emergencies. By having an emergency fund, you’ll have less financial stress during difficult situations. Whether it’s taking your car in for a service, paying for medical bills, or having enough money to use if you’re looking for a new job.
2. How much should you save?
How much you save is really your own decision. But we recommend you save enough money to cover up to 3-6 months’ worth of expenses. That way, you’ll be better prepared for almost any emergency.
3. It’s easier than you think
When you make a priority of it, it’s much easier than you think. There’s this saying ‘pay yourself first’ and that’s the secret to success here. Once you receive your monthly income, immediately put money aside into your emergency fund. Then you know it’s done and you won’t accidentally spend it. Plus, it’s super rewarding to see your fund growing. TIP: With Go & Grow, you can set your goal amount and see how each payment and return gets you closer to your emergency fund goal!
6 beginner investment mistakes you can avoid – Bondora
When you’re new to investing, it’s understandable that you might fall into some traps and make some mistakes. But we’re here to help! We listed 6 investment mistakes beginners make so you don’t have to make them.
1. They put all their eggs into one basket. You should always diversify your portfolio to help manage risks
2. They invest everything they have. Rather be cautious while you’re learning how investing works. It might not be fun, but it’s better than losing everything.
3. They have no plan. You need to know what you want to achieve with your investment in order to work towards that goal.
4. You invest into something that’s too good to be true. Do your research! If something is too good to be true, it usually is.
5. They think they’ll get rich quick. Investing is a patient, long-term game and most people won’t become a millionaire overnight.
6. They make rushed decisions. It’s easy to want to withdraw all your money when things get rough (remember March 2020?) But you’ll end up harming your investment more in the long run. Don’t rush and remember, you’re investing for the long term.
Now you know the 6 most common mistakes beginner investors make and how to avoid them. We hope you can use these tips to better your chances at building wealth.
Black Friday is almost here – Bondora
So, it’s that time of year again. Black Friday is just days away, and we know you’re scouting out all the best deals and sales. But is it really a bargain if you buy something you don’t need?
Sales are designed to trigger us into buying things we don’t always need. And Black Friday is the mother of all sales. And listen, if you’ve been waiting to get the latest gadget and you can get it at a 75% discount on Black Friday, that’s great.
But before you buy that new hairdryer, or a kitchen appliance you’ll never use, or the latest home entertainment system just because it’s on sale, then think twice before clicking ‘Add to cart’.
Rather use that money you would have spent on something that will gather dust in your cupboard and invest it. Not only can you get returns on your investment, but you’ll also feel great about yourself for not buying things you don’t need.
Just ask yourself:
- Do I really want this?
- How many times will I use it?
- Is this a good investment?
If you use these 3 questions as a guideline, you’ll be a responsible sale shopper!
And that’s it for this month. Remember to subscribe to our channel for more financial tips. Keep investing and bye for now.