Read the first book to understand investment and financial management

Chapter 4 Investment and financial management should establish a correct concept of financial management (1)
We are not short of money but lack of ideas
The healthy development of China's wealth management market requires financial institutions to continuously improve their financial services, develop more and better wealth management products, and cultivate more high-quality and compound financial talents; Financial education to cultivate investors' financial awareness.In financial education for investors, it is very important to establish a correct concept of financial management.

What is the correct concept of financial management?
1 Financial management is a long-term process that requires time and patience, and it is impossible to get rich overnight

2. A family is not a business. The security of assets should be the first priority, and the profitability should be the second
3 Establish risk awareness, investment is risky
Low-risk investment products, such as bank deposits and government bonds, are difficult to generate high returns; high-risk investment products, such as stocks and industrial investments, may generate high returns, but can also lead to huge losses.

4 To ensure good asset liquidity

Maintain sufficient payment capacity, and don't stretch the capital chain too tightly.

5 Insurance is one of the important means of protection
Insurance is an important part of family assets, and an insurance is also a caring for family members.

6 Choose financial products according to your actual situation and risk tolerance, and don’t follow the crowd
7. Don’t overspend
Especially for loan consumption, such as mortgages, car loans, etc., loans are rigid.Minimize your household's debt burden.

8 Stocks Are One of the Best Long-Term Investment Vehicles
It is the most effective investment method to greatly increase the value of family assets, but if the investment is not operated properly, it will lead to huge losses and cause family financial crisis.You must not use borrowed money to speculate in stocks.

9 Reasonable separation of life security (cash, bonds, housing, cars, insurance, education) and investment appreciation (stocks, industry, real estate) Investment appreciation is a long-term behavior, the purpose is to improve the quality of life, don't just because of investment Reduce the current quality of life.Investment funds should be funds other than normal living consumption. Only by investing with such spare money can investors maintain a good attitude.

10 To learn financial knowledge, to be able to communicate with professional financial personnel

Be discerning, because the money is yours.

11 You can entrust financial management, but choose the trustee carefully
12 To prepare a household financial statement

Including the balance sheet and the cash flow statement, so that the income and expenditure can be counted and the bottom of the heart.

13 To formulate quantitative and reasonable financial goals
Allocate assets according to financial goals, so as to be targeted.

14. Resist the Temptation of Excessive ROI
Any project with an excessive ROI is suspect.

15Invest in a project

Consider the risks first, and then the benefits. If the risks cannot be reasonably controlled, the benefits will be out of the question.

For investment and financial management, concepts come first. Only by establishing correct financial management concepts can we formulate reasonable and scientific financial management goals, avoid blind and erroneous financial management behaviors, and make investment and financial management truly for our own use and obtain huge benefits.

Why did you not share the fruits of economic growth
Are you still envious of how other people are so rich?Do you think rich people will get richer because they can invest?Do you always feel that it is impossible to make a fortune with a little money?In fact, you are wrong. The economy is developing so fast, and the development of society has brought more and more rich people. Why don’t you share the fruits of economic growth?Start learning financial investment now!Isn't it a good thing to let the money in your hands change from less to more, at least to ensure that your purchasing power does not decline when prices rise?
Don't think that you can't invest in financial management with small money. As long as you master certain financial management skills, you can make your money more and more abundant.

First of all, we must get rid of the three major misunderstandings of financial management:

The first is that financial management is a matter for rich people, and small money is not worth taking care of, which is what most people think;

The second is that there are prejudices against many financial products, and they think that some financial management methods are deceptive;
The third is that we cannot face up to risks, and risks and benefits are often inseparable.Only by getting rid of the three major misunderstandings of financial management can we correctly understand the meaning of financial management and manage financial management more effectively.

One day, a financial planner was giving a speech on financial management, and found a middle-aged man in the audience with a sad face, which was particularly conspicuous in the crowd.A group of people gathered around the financial planner to ask various questions, but the man stood far away and did not dare to approach.When the people were almost gone, he came over timidly.Carrying a very worn bag and wearing very old shoes.He introduced his income situation, saying that he lived alone with his children, and he could only have a few hundred dollars left a month at most, and he had no money to manage at all.

The financial planner said that the law has never stipulated that if you have less money, you cannot manage money.The less money you have, the earlier you should plan.The man was not out of money, but underfunded.This must not be difficult for yourself.It can be raised through correct consumption arrangements and consistent savings.If you insist on saving 3 yuan per month and use the money for long-term investment, if the annual rate of return is around 10%, then it will become 30 yuan in 6550 years.

The man made the mistake of thinking that managing money is a rich man's game.In fact, this is not the case. Financial management is related to all aspects of life. You can show your financial management ability in all aspects and make your life more affluent and richer.

The 35-year-old Ms. Fang can be regarded as an excellent "family financial officer". In terms of financial management, she has always insisted on prudent and rational investment. At present, under the skillful management of Ms. Fang, the family finance is growing by 20% annually ~30% of the goal keeps moving forward.

In terms of financial management, Ms. Fang has gone through a difficult time.It was when she was newly married, Ms. Fang and her husband could only live in a rented house due to financial constraints. "When choosing between buying a house and having children, I chose the former," Ms. Fang said.After 4 years of marriage, they finally saved enough money to buy a house. After moving into the new house, Ms. Fang also gave birth to her precious child. "At that time, we were late in childbearing, but economic conditions did not allow it, so we had to do so."

Now, Ms. Fang and Mr. Fang's income is basically stable, the burden on both families is not heavy, and their savings are relatively substantial.When Ms. Fang manages the family finances, she not only invests appropriately, but also considers the security of the family.She first purchased critical illness insurance and personal accident compensation insurance for herself and her husband to ensure that their children's life education can be guaranteed in the event of an accident.Secondly, she also purchased hospitalization medical insurance for herself, accident insurance for her husband, and rebate-type dividend insurance for her children, establishing a security system for her children.

In terms of investment, Ms. Fang tends to invest in stocks. "I never speculate in black horse stocks or theme stocks. I usually buy some high-quality stocks with generous dividends. If the stock rises and meets my profit expectations, I will sell it. If it doesn't work, I will wait for it to pay dividends." Since 1997 Since investing in the stock market, Ms. Fang has used her unique investment method, not only did she not lose money, but she also gained considerable profits.

Seeing that the economic development is getting better and better, Ms. Fang is now prudently investing in some shops. However, the return on investment in this area is low, and Ms. Fang is just trying it out.

Ms. Fang's example can give you some inspiration?As long as you are good at financial management, even if you are not very rich, you can make your life more and more prosperous and truly appreciate the fruits of economic growth.Therefore, we must change our concept and start to make a financial plan for ourselves from now on, so that we can become a master of financial management as soon as possible.

After establishing a correct concept of financial management, the more important issue is how to master the skills of financial management.Financial management is a science that needs to be learned, but as long as you master the skills, it is not difficult to become a master of financial management.Faced with many investment channels such as banks, insurance, stocks, funds, bonds, foreign exchange, etc., we can formulate our own financial planning according to our own situation, and we can also rely on the help of professionals.In short, as long as you analyze carefully, you can always find the investment and financial management method that suits you.

To invest in financial management, you must first clarify your misunderstandings in investment and financial management, so as to clear obstacles for future investment and financial management activities and obtain ideal returns.

Don't follow the trend, don't be a blind "herd of sheep"

A flock of sheep is a very disorganized organization. They usually rush left and right blindly when they are together, but once a head sheep moves, the other sheep will rush forward without thinking, completely ignoring that there may be wolves in front of them or that they are not far away. There are better grasses everywhere.In life, we are often inadvertently affected by the "herd effect".

In economics, "herd effect" is often used to describe the herd mentality of economic individuals.Therefore, "herd effect" is a metaphor that people have a herd mentality, which can easily lead to blind obedience, and blind obedience often leads to deception or failure.

Perhaps many people will scoff at this, the intelligence of human beings is of course far higher than these ordinary animals.But the fact is that in daily life, the "herd effect" can easily appear in ourselves.The most common example is that when investing, many investors find it difficult to rule out the interference of the outside world. They often follow what other people say, and they follow the trend when others invest; produce psychological and behavioral effects.

Following the crowd is a habit of many people. You see, everyone else is like this. Let's learn from others.Such views will never make you rich.Like an investment fund, if it is invested in 25 or the first half of 26 under the premise that most people are not optimistic, by the end of 26, 1 yuan can be changed to 2 yuan, and 2 yuan can be changed to 4 yuan. At the end of 26, everyone saw that the fund was making money, and they all bought it. I am afraid that it is impossible to have a return of 1%.

Now people pay more and more attention to investment and financial management, so some scenarios are very common.For example, when several people were chatting together, they mentioned that they need to spend some money for investment, so some people said that they bought a few stocks, and the income was not bad; but this statement was immediately opposed by many people—— Some people say that the risks are too great, and others say that buying funds sometimes loses money.

At this time, someone suddenly came up and said, buy gold. I heard that the income of gold is good, and it has been rising.Someone immediately echoed this statement, "Yes, yes, I also heard that gold only goes up but not down. It is very cost-effective to buy gold when the inflation rate is high." But how to buy gold?The man who proposed first fell silent.After a pause, someone said: "It seems that I heard that there is physical gold to buy, and gold futures have also started to come out."

(End of this chapter)