Since the first episode here of the smart investor we have built a progression that starts in the mindset of the smart investor. I say this, because before talking about the various investments themselves, it is necessary to build this mentality.
The smart investor knows that it is necessary to have the fundamentals on how to deal with the money and not only the technical knowledge on each type of existing investment.
In today’s episode we will reflect on the types of cash flow and which one the investor should look for.
To recapitulate one of the points of our last episode, to achieve security, independence and financial freedom, it is necessary to have something that goes beyond having money.
There must be a flow of money. That is, it is necessary to build something that guarantees a constant inflow of money that is greater than your expenses.
So let’s talk about the 4 types of cash flow so you can assess which type is which type do you consider the ideal for your life.
Flow of Money in 4 Forms
Robert Kyosaky, in the book Rich Dad, Poor Dad, says that 4 types of people make up all the businesses in the world. That is, the entire flow of money comes from these 4 types of people:
The employee is that person who seeks a safe and beneficial job. Seeks to have a job that will support you, if possible, until retirement.
A large number of people are subject to this type of cash flow because, in most families, parents insistently repeat their children’s education: “study hard and then get a good job”.
Employees depend on the companies they work for to have a cash flow.
If the company faces difficulties, it will suffer the consequences even without participating in the decisions. The cash flow of employees depends on the decisions of others.
The second group, that of self-employed professionals and also small business owners, are those who can work on their own, receiving according to what they produce.
They then work for themselves, that is, if they work they receive money and if they do not work they do not receive it.
In the case of the self-employed, they have the power to decide on their work, but they only guarantee the flow of money if they are actively working.
The third group is that of the owners of big businesses. They look for good systems, a good network and competent people who help in the growth of the business.
The great goal of these people is freedom. This freedom is perfectly possible since your business does not need your direct work to function.
The result of your work is enhanced by the systems and competent people that make the business generate cash flow. So, money works for big business owners.
The fourth group is that of investors. They are those who seek true freedom. They have employees, self-employed professionals and big business owners working for them.
With that, the money works fully for them, generating a constant flow that we call passive income. So to be an investor you need to build sources of constant cash flow. It is necessary to build a passive income.
Simultaneously Building a Passive Income
First of all, you need to understand the difference between assets and liabilities. Robert Kyosaki also explains this in the book Rich Dad, Poor Dad.
This is the main foundation of the concept of Financial Competence. And here I am not talking about the accounting concept of assets and liabilities. It is a much more intuitive concept.
Basically, assets are those things that put money in our pocket and liabilities are those that take money from us.
From there you should start to assess whether you have more things that take money out of your pocket or more things that put money in your pocket.
To understand better, let’s imagine that you buy the car or the house of your dreams. Will these two acquisitions put or take money out of your pocket?
In addition to the purchase price of these two assets, you will have, from then on, IPVA, annual insurance, revisions and maintenance and the continuous devaluation of the car, as well as IPTU, home insurance, house maintenance, etc.
In neither case will you have money going into your pocket after purchasing these two goods.
On the contrary, you will have money coming out of your pocket. So in these two examples, you would be acquiring a liability rather than an asset, as most people think.
It would be different if you acquired a property so that you could receive rent. In that case, every month the acquired asset would put money in your pocket. So, a property acquired to have a rental income is an asset.
While ordinary people prioritize consumption and immediate well-being, the smart investor makes decisions that increase the number of assets because he knows that these assets will generate enough cash flow to pay for the liabilities he wants.
Realize that the smart investor still has liabilities. The difference is that, before acquiring liabilities, he builds a solid column of assets that makes dreams, comfort, luxury, etc. possible.
The smart investor understands that he needs to go through the asset accumulation phase before starting to buy liabilities. He makes his assets pay his liabilities account so that he is free of those payments.
You probably live with one of the biggest energy thieves out there and it’s all your fault. Simply because you don’t worry about having good time management.
Do you know when you’re at work , but thinking about the many things you need to do when you get home?
Or when you’re at home, thinking about the jobs from that online course you signed up for?
Or when you’re sitting ready to study and start sketching what you need to do the next day when you get to work?
Yeah. If this happens to you, chances are you end up doing nothing that should be done right, and you are still extremely tired and pending.
With a feeling that I would need to have more hours in the day to handle everything.
That’s the kind of thing that just drains all of your energy and doesn’t result in anything productive.
That is exactly why this thing of thinking about something when it cannot be done is considered one of the biggest energy thieves out there.
But why do I say it’s all your fault for living with it?
Because everyone has the same 24 hours to do whatever they want, every single day.
And yet, some people seem to have enough time to do whatever they want, while others are always running from task to task and never finish anything.
In fact, we all have enough time to complete our routine.
The difference between these two types of people is their control over their own time.
And you decide and manage it. Only you.
So, how do you solve it and eliminate this energy thief from your life once and for all ? With good time management.
If you have no idea what this is, don’t worry. That is precisely why I am here today. I’ll explain everything about it:
Why it’s important to manage your time
What are the main villains of time management
The techniques you can use to manage it better
Tools that will help you optimize your time
And I still offer 5 tips that you can put into practice today to be a more productive person. Just stay here with me.
So let’s go!
Time management (or time management) is the way you decide to use your time to maximize your productivity and achieve your goals .
As I just said, although everyone has the same 24 hours every day, only a few people are able to use them more profitably and thus be more successful .
Does this mean that these people are special? That they were born with a gift? Absolutely not.
The truth is that everything has to do with how each manages his own time.
And managing your time is precisely the process of planning , controlling and executing your actions so that you are aware of the amount of time it takes to do each of your day’s activities.
The main objective is to make you more effective (really do the things you need to do), efficient (do these things well) and productive (get the best out of your time to do them).
I would say that this process is essential, especially for small entrepreneurs who are starting their own business.
Think with me.
It is no longer easy to run all projects, launches, follow the defined planning, manage marketing , sales … In short, deal with all the business demand.
Now imagine doing this without the least amount of organization or even awareness of your own time.
In order for everything to work out in the end, you need to know how to distribute each small task according to the time available until, at the end of the day, you have checked your entire to-do list.
Exactly for this reason, time management is considered a very important point in project management, attention and even personal management.
And, if you think that only extremely organized people can manage time well, take it easy…
It is fully trainable. Even a person whose routine is all messed up, confused and who can’t finish things on time, for example, can manage time well.
Just have the right techniques , tools and skills at hand.
What’s more, what I’m going to tell you in the next few lines can be applied both at work and in your personal activities.
The ideal is that you can combine the two to have a completely productive and successful routine.
Is it Important to Manage Your Time?
Managing your own time directly impacts your life. In fact, it is just about how you are going to live it.
And the concept of time management itself already speaks of the central objective of the stop.
The increase in productivity, which is precisely the ability to be able to produce more, better and in less time.
For that reason alone, I am already very enthusiastic about the subject (and you should too!). But the best part is that it doesn’t stop there.
Good management of your time can help you to deal with short and tight deadlines. It gives you clarity about what needs to be done and when you will be able to finish each task.
In addition to decreasing the chances of you being caught off guard by some unplanned demand.
So the chances are that you will experience less stress in your day to day (at least in relation to that, right).
Their commitments and activities tend to be fulfilled at the right time. Further, it brings greater satisfaction and self-confidence in relation to their own work.
You will also have less rework, less time wasted and more free and quality time, being able to focus on what really matters.
And you will still have a good reputation. People will know they can trust you, as you will be more likely to meet agreed deadlines.
Now, how do you have it all in your life? Well, you will need some skills, which I will talk about right now.
First, let me introduce you….
The Main Villains of Time Management
Before talking about the tips for a more productive life through good time management. I need to give you a letter about the things that hinder you in this process.
That are probably stealing your time and energy.
Not to mention the day-to-day external and unforeseen things that can make your life difficult, there are those things that just depend on you.
I am talking about disorganization and procrastination .
To escape these two pitfalls, I suggest that you pay attention to how your workplace is doing, if the things you use are always close at hand, in the same place …
Or even if you always seem to be putting out fires, doing activities at the last minute.
The point is, if you don’t keep an order or leave things more important or complex for later, you are only postponing a problem that will eventually need to be solved.
This negatively affects your productivity and can result in totally unnecessary effort.
So be careful that you are not cheating and self-sabotaging.
And I told you specifically about these two points of attention, because avoiding them is essential for you to be able to put into practice the…
7 Essential Tips for Good Time Management
Now you know that time management is completely trainable .
Some of the skills I’m going to tell you about next may seem unlikely to be done, but let me tell you something …
This has to do precisely with the habits that you have cultivated in your life.
If you have established bad habits for your time management, really what I am going to tell you here will feel like something out of this world.
But it is not. None of them.
The truth is that you can very well start putting each one into practice in your day to day and it doesn’t have to be all at once, because the change is really gradual.
It’s that story: direction is more important than speed.
Yeah. So, write down what you need to do to be able to manage your time well:
1. Find your “prime time”
Have you noticed that there are some times when you perform much better than the rest of the day?
Yeah. These are the so-called “prime hours” of productivity.
For some people, it is early in the morning; for others, in the afternoon or even at dawn. The point is that it varies a lot from person to person.
Before you start planning your routine and working on your time management, it is important that you find your own prime time.
Because this will be the moment when you will prioritize your most important activities and those that demand the most time and energy.
2. Know how long each thing takes
I am giving the words here so that you do not do like me, that it took me to understand the real time to carry out my tasks, and ended almost all my days frustrated.
It is important that you know well how much time you have to do your things and how long it actually takes to get done.
Then, make a list of your daily activities and write down on the side a realistic estimate of how long each one takes.
This prevents a big difference between your planning and reality.
3. Plan ahead
One of the worst things you can do is go into the workday without being clear about what needs to be done .
The time you spend thinking and planning your activities is trivial compared to the time you will spend jumping from one thing to another (and rarely completing any of them).
I suggest you do two things, at first:
In the evening or at the end of the day, take 15 minutes to clear your table and plan your activities for the next day.
And in the morning take the opportunity to review these notes and remember what your routine will be like throughout the day.
If you want to go further, I also recommend monthly planning. It can give you a glimpse of what the next weeks will be like and how to better prepare for them.
These are details that can make your day even more productive.
4. Schedule your tasks
Take a few minutes in your week (I usually do this on Sunday) to create a plan for your entire week, dividing your goals into daily tasks.
So, you just need to take a look at this list from time to time while working.
The Geronimo Theml, a leading expert in productivity in Brazil, say that “if you do not schedule your tasks, you end up turning someone’s agenda.”
So, anticipate and manage your tasks, whether on paper, in a spreadsheet or in an application designed for that.
Make a list of all the tasks that come to your mind and the time needed for each one, as I explained earlier.
Try to complete them one at a time and don’t start the next one unless you have completed your previous task.
When you are finished, check the completed activities. This gives your brain a feeling of reward , which becomes even more motivated to continue.
Ah! As you write down your activities on the calendar, remember that your energy and creativity levels may vary during the week.
As you get to know your own pace better, adjust your planning so that it becomes more realistic and doable.
Tip: Add a “done” area to your to-do list.
Sometimes, unexpected and urgent demands arise during the day. Write them down in a separate list next to your scheduled tasks. This will bring extra satisfaction at the end of the day.
5. Set deadlines
As soon as you take on a task, set deadlines and strive to complete them even earlier.
But do it wisely. Remember to analyze what I told you up there: how much time needs to be dedicated to a specific task and for how many days.
Especially because it is important to put a time limit on your activities. It’s the kind of thing that will “force” you to focus better and work more efficiently.
If you have 2 months to complete a project, you will do it in 2 months. If you only have 2 weeks, you will be able to finish in 2 weeks.
6. Take planned breaks
Is it saturated? Take a break.
But be sure to do this only in extreme situations. The thing here is really to plan strategic breaks .
To give you an idea, the human brain can only focus for about 90 minutes at a time .
Therefore, schedule a break at least every 90 minutes to avoid wear and tear and maintain high productivity throughout the day.
7. Escape distractions
This tip here has to do with that stop to control your environment .
Do you want to be more productive and focus on what really matters? Then program and control your workplace to achieve that goal.
When working on specific tasks, activate the “do not disturb” function on your devices.
Going offline can also be an option, depending on the activity you are doing.
And speaking of distractions …
After this article, you will not stop living with one of the biggest energy thieves that can exist.
Because you have everything you need for good time management.
I showed you what it is, how important it is to manage your time and what are the main obstacles to this process.
You saw 7 tips that can be applied today to manage your routine well, such as delegating tasks, setting deadlines, prioritizing the most important, planning ahead and avoiding distractions.
And also 4 methods that will help you to manage your time better, among them the pomodoro technique and GUT matrix.
I even gave the lyrics about some tools to further optimize your time and that of your team.
Oh really. No more excuses for your day to continue to be insufficient for your demands.
The thing is to take responsibility for your time and make the stop happen.
You will see that when you manage to overcome this challenge in your life. Chances are you will be able to do the same in other areas, being increasingly productive in all of them.
What’s up? Did you like the tips in this article? Is there anything on this list that you already put into practice in your day to day?
Tell me here in the comments! I would love to know.
Everyone wants to know how to speak fluent English. Fluency in English is increasingly required by the job market. You will hardly find a job opportunity, with the chances of having a successful career. The language is not requested at least at an intermediate level.
Learn to Speak Fluent English
In addition, large companies demand, without exception, fluency in the language. With globalization, we are getting closer to the rest of the world. Knowing how to talk in more than one language has become essential.
Learning a new way of expressing yourself will open many doors to information. With English, you can communicate with foreigners, get to know other cultures and even access materials available on the internet.
To improve your language skills, it takes effort and dedication. But also an investment in more creative and interactive forms of learning.
Many schools are more concerned with teaching grammar and sin about what really matters when practicing the language.
A person can know many words, verbs and grammatical rules. However, if he does not know how to use them when talking. Then, there are no advantages to this knowledge.
To learn a second language, the process does not have to be very different from the one.
We go through to become familiar with our mother tongue. As it is the experiences with the new language that will increase our chances of acquiring fluency in it.
Are you curious to know how to speak fluent English? Continue reading and learn more!
Look for Qualified Materials and Schools
Use good books and audios and look for qualified institutions to learn English. Accessing quality information will give you a good basis to develop and acquire fluency in the language.
Value courses that seek to encourage students to converse in the new language and use inviting and easy-to-understand materials.
It is extremely important to know the study tools of the institution you choose well.
Identify whether the school values quality and seeks a balance between the most bureaucratic and the most playful teaching. See if the material proposes English living and experimentation activities.
Daily training is essential to improve your skills. You can dedicate it.
For example, 20 minutes a day, training pronunciation, speaking with the mirror, trying to learn new words and trying to apply them in sentences. Memorize well, you can learn English even when cooking.
Practice the exercises in the books and even try to read aloud. When speaking, you have to be resourceful and quick with the language. Then only, You will able to make the thought precede the word.
Try to create whole sentences in your mind and, from the elements used in those sentences, create new sentences.
Exercise the ability to reason in English from an early age. This is an essential step to acquiring fluency in the language.
Exercise language thinking
Thinking in English can be a great strategy to make you more familiar with the language and improve your fluency.
This is because you will get used to the words of the language and avoid translations to produce phrases.
Translation can make your learning slower and even incorrect, since in Portuguese the word order in a period is different.
There is no formula for you to start thinking in English, unfortunately! But there are several ways to stimulate the brain to do this. So, this is a practice that will take time and require patience and dedication.
Practice, as we already know, is a path to fluency in a language. Just think about how we learn our mother tongue, experiencing and practicing from what we hear and see.
It is essential that you are involved with the language on a daily basis. So that this process can bear good fruit.
Have Constant Contact With the Tongue
If the language gets into your routine, it will be much easier to acquire fluency in it. Try putting your phone, computer and social media in English.
Write phrases on small papers and distribute them around the house. Place a note next to your toothbrush.
For example, with the words: “I need to brush my teeth, this is my toothbrush” (I need to brush my teeth, this is my toothbrush).
Basic everyday actions can help you build grammatically correct sentences, so don’t use isolated words.
Try to read books or comics that deal with topics that interest you. The comics, generally, tell stories well known by different audiences. It will help a lot. Knowing the context of the story is a step to better flow the reading.
In addition, reading will enrich your vocabulary and help you learn more about sentence structures.
Gradually, you will become more familiar with the different cultures that involve the English language. With that, you will improve your skills.
Watch Programs With Audio and English Subtitles
Movies and series are good options for polishing your language learning. Always opt for audio in English, so that you will exercise listening and know popular expressions of the language.
To accompany, the caption also in English will facilitate the recognition of words and the discovery of vocabularies that you do not yet know.
If you are just starting your apprenticeship. You can watch the materials in English with Portuguese subtitles. Little by little, adapt and put them in English.
The ideal is to avoid mixing the two languages. If necessary, stop the scene, go back and try to understand from the context.
It could be an American series, an interesting movie or a TED, for example. The most important thing is to have the experience of listening. Thus, being able to get used to the foreign language.
Use Technology to Benefit Learning
Contact with technologies is a factor that helps more and more when it comes to fluency in a language.
There are some applications that can collaborate when learning English. Many of them are free and can be installed on your phone.
Among the most used are Duolingo, Hello English and Lingualeo. Each one, with its specificities, offers the opportunity to have one more way to stay in contact with the language on a daily basis.
In addition to the apps, there is also the option to learn by listening to podcasts. Successful especially among young students is a tool that can be used in many ways. There are countless teachers and specialists in English language teaching who provide audios.
Spread across networks, podcasts can be downloaded to listen wherever and whenever you want.
There are many benefits of technologies for those who want to be fluent in English. Learning through games also stands out.
Many students who are beginning to study the language testify. Already know something by playing video games or online games in the language.
Like movies and series, games help with vocabulary and you have fun learning a new language.
Learn How to Speak Fluent English by Talking Without Fear of Making Mistakes
Don’t be afraid to make mistakes when speaking in English. They are part of the process and show that you are trying to understand the logic of the language.
When we are learning to speak, it is common to miss conjugations, pronunciations, vocabularies and to be a little anxious. But don’t let these difficulties stop you from communicating.
Some tips to overcome this barrier can be applied very easily. Create some stories about yourself and tell them in English. Then, learn phrases that are essential in everyday life, such as greetings and everyday expressions.
With the time of practice, you will find that the conversation will become easier. This makes you feel like you have progressed in the language.
Experience a Weekly Meeting Speaking Only in the New Language
Choose a trustworthy person, with more advanced English. To have a moment of leisure when they speak only in the language.
Anyone who wants to improve and have fluency in the language needs to be patient. Know that despite being a moment of relaxation. The goal of how to speak fluent English also becomes a time of learning.
If that person lives in the same house as you, even better. So encourage your brothers and relatives to study with you!
Try to make these moments happen regularly and choose simple programs, such as lunch, coffee or going to a square.
If it is not possible to book with a colleague or you do not have someone at home. Then, look for a school that values this type of interaction.
Now you know how to speak fluent English, don’t you? This is a learning process. It involves a lot of effort, dedication, and the use of interactive strategies to improve your skills.
Seeking to speak without fear of making mistakes. Having contact with the language and watching programs with audio and subtitles in English. It is one of the great ways to become more familiar with the second language.
Practicing the application of new words and searching for qualified material is also very important for your learning.
And scheduling meetings to train with a natural language conversation is essential for you to speak English more easily and easily.
In addition, more and more technological tools collaborate for language learning, making access to a new language easier and faster.
When it comes to improving our personal finances, we have many alternatives on hand. They all sound easy on paper. But, when the time comes to put these financial decisions into practice. Countless excuses arise that keep us from prospering economically.
That is why if we want to positively impact our bank account. We will not only have to make a series of important financial decisions. But, we must also give up those excuses that have stalled us.
Financial Decisions to Improve Your Personal Finances:
In this article, we will share those financial decisions that will have a positive effect on your finances. Some of them require you to change your habits. Learn to generate passive income. Change your mindset, among other changes necessary to change the course of your finances.
Each of these financial decisions will put you in a favorable position. Since you will not only learn what types of debts exist? Also, the importance of your credit history. But also put your personal finances as an important topic in your life. Therefore, you will dedicate a greater part of your time and dedication.
While these decisions are not easy to make, they will certainly be worth a try.
1. Spend less than you earn:
This is one of those financial decisions that you usually find in most personal finance articles. But, that you hardly apply.
It is very easy to say that you will spend less than your income will be. And, it is just as easy to forget when you see those clothes that you don’t need. That new phone or that sudden trip.
However, when you have discipline and commit yourself. You can make the decision to stop closing each month in the red. To have to go to your savings to cover the unnecessary expenses you made during the month.
2. Get debts that generate income:
How many times have you told yourself? That, the reason you don’t start that business idea you have in mind is that you don’t have enough money?
When you really want to do something. Such as start a business. Ranging from starting a business with low capital or acquiring loans online that you can use to finance your projects.
Loans for business, or those you use to buy machinery, equipment, or tools, are considered as good debts. Since you will be generating income from them, and therefore, using the capital of a third party to leverage financially.
3. Save before you spend a single penny
the millennial generation is characterized by being careful with their financial movements, even 83% believe they could save more money. However, many remain in the “consider”.
Saving a percentage of your income is one of the best financial decisions you can make. To start, you can save 10% of your income. Set aside this money before paying your bills or spending money to maintain your lifestyle.
If you find it very difficult to do so, you can automate this saving from your bank account. This way you will save money without realizing it, and you will have no excuses for not doing it.
3. Have a margin of error in your budget:
The first thing is that you must have a budget. Unfortunately, many people do not consider it lazy. Because, they do not know how to do it, or worse, because they do not understand what it is for.
A budget is a tool that allows you to keep track of your personal finances; starting from the income to the smallest expenses. When you have a budget you can keep track and control of expenses.
If you are creating your first budget, remember that this should not be extremely rigid. Since there are unexpected expenses and income that appear. The idea is that your budget is a guide, and not a straitjacket that limits you.
Based on this reality, one of the financial decisions that will positively impact your bank account. It is to maintain a margin of error in your budget. Money to cover an emergency, an unexpected expense, an unplanned date or event, among others.
5. Set financial goals:
If you want to positively impact your bank account, you have to know where you want to go. It is impossible for you to achieve your financial goals if you don’t have one to begin with.
Remember that a financial objective is not to want an increase in your salary. It is to define how you are going to invest the money you save. For how long and what rate of return you hope to achieve.
To start you can define three objectives; one short, one medium and finally one long term. Let’s take an example:
Short term, that is to say in 6 months. You will commit to getting out of all the debts that are not generating income.
Midterm, in 3 years. You commit to investing 50% of your savings in a fund that invests in the stock market at an average rate of 10%.
In the long term, that is to say in 5 years. You will have your own apartment which you financed and covered with the income of the stock market. A part of your salary, etc. You can even start making real estate investments.
The more specific you are with your goals, the clearer your mental image will be and therefore the easier it will be to achieve.
6. Evaluate and measure your financial growth:
To meet your financial goals you must measure your financial growth. That which is not measured is not improved, and your personal finances are no exception to this rule of life.
Make the decision to evaluate yourself. Ask yourself what your financial performance was like.
Spend your money on?
What did you invest in?
Were purchases done emotionally?
Decisions that helped you achieve your goals, and what did not.
You can create your table in excel and measure your performance. For example, make comparative tables in your budget. Measure how the spending was on different items. Such as outlets, purchases, basic needs, investments and others.
These are the kinds of financial decisions that most people do not make because they are lazy. They are the same ones that complain about their current situation. They do nothing to change their current state of life.
7. Pay your bills and debts on time:
Before you start saving, the first decision you should make is to pay off your debts. Especially those that do not generate income and that have a high-interest rate.
The importance of this decision is to avoid paying interest in default. Which indeed little by little is bleeding your bank accounts and consequently affecting your personal finances.
Now, when you pay your monthly bills on time, or in advance. You have some savings that you could use as a margin of error in your budget. You could invest in the stock market and generate extra income.
8. Build a good credit reputation:
The previous point will help you build your credit reputation. The importance of this decision is that many times, it is better to have friends and a good reputation than money itself.
When you have a good reputation. That is to say that you pay on time, fulfilling your responsibilities. Your personal finances demonstrate it, many investment doors will open immediately.
Make the financial decision to pay your bills on time. keep your promises. Put the money you receive to good use. Look to the future. Be clear that much of life’s success comes from image and reputation. that you pass on to others.
When you have this philosophy of life, people will trust you. They will invite you to their businesses to invest in their projects. They take you into account in their financial decisions that will be reflected in benefits for your life.
9. Diversify your sources of income:
Regardless of how many zeros your salary has, don’t rely on a single source of income. The risk that you run when depending on only one, is that once it fails, your finances will be affected 100%.
As the end of the year approaches, it is time to do accounts and think about the Treasury . What you do not do until December 31 will weigh on you in April when the time comes to make the 2019 income tax return. And it is that the personal income tax is paid from one year to the next , so you still have time to take letters in the affair.
There are two ways to save on the tax return and with one you save much more than the other. The first and most common is to get it right when making the tax return and for this you can see here the key boxes to pay less taxes .
The second is a little more cumbersome, but also more effective. It consists of planning to pay less taxes. You have time until the end of the year to do it and according to the calculations of the association of the technicians of the Treasury, Geetha, you can save 4,300 euros on personal income tax.
Also, the higher your income, the more you can save. Specifically, people with earnings below 21,000 euros can pay about 1,595 euros less. However, if your salary is around 30,000 euros, tax savings can skyrocket to 7,839 euros.
How to save that money on rent? Basically, getting ahead of yourself when doing personal income tax and starting up one or more of these 6 things that you can do before the end of the year to save on taxes.
Before continuing, you can start by simulating what your 2019 income will be like. The Tax Agency has a tool to do the calculations. Do the first test and then recalculate the result by adding one of the actions to pay less taxes that we tell you below.
Contribute more to the Pension Plan
Pension plans are a very useful tool to pay less in rent. And it is that the money you contribute to the plan will reduce your tax base, so that the more you contribute the less taxes you will pay.
The key question at this point is whether it pays to contribute to the pension plan to deduct. The trick at this point is that it compensates those who earn the most. In fact, if you earn less than 60,000 euros, the tax savings for investing in pension plans will be rather low. The reason is that the money you contribute to the plan is subtracted from your tax base and that the personal income tax is progressive (you pay more the more you earn).
If you have earned 25,000 euros and you contribute 5,000 euros, for the Treasury it will be as if you had only entered 20,000 euros. As the income in that strip is taxed at 30%, the tax savings will be 1,500 euros. However, imagine that you earn 80,000 euros and invest those same 5,000 euros. The tax savings will be 4,500 euros because from the 60,000 euros the rate you pay in rent is 45%.
Take advantage of the deduction for housing
This formula for paying less taxes only applies to those who bought your home before 2013 . If this is your case, you can still apply the deduction for home purchase. With it you will save a maximum of 15% on a maximum basis of 9,040 euros.
This amount is maintained in both individual and joint declarations. For this reason, if you are married and the house belongs to both, opting for the individual declaration will ‘double’ the number. And it is that each one of you will be able to deduce on that maximum basis.
When adding what you have paid for the house, do not forget to add the insurance-linked to the mortgage. If you have not reached the maximum of 9,040 euros, you can advance more money to pay less taxes and save interest.
Here you can see if it pays you to pay off part of the mortgage before to pay less taxes. And it is that as an investment to pay less interest on the house it will usually be positive.
Find out if you want to offset investment losses with equity gains (even if you’ve sold the house)
If you invest there is a very powerful tool to reduce what you pay in personal income tax. This is the possibility of offsetting capital gains and losses. When making the income, the Treasury allows you to subtract the losses you have suffered from the gains you have made. This way you only pay for the real benefit.
If you plan properly, you can save a lot of money , especially if you sold your house in 2020 or if you plan to do it later without reinvesting the money (remember that if you reinvest the money in the house to buy another, you will not have to pay taxes on the profit you obtain ).
The trick is that by offsetting losses with gains, you avoid paying taxes on the profit you have made and thus save between 19% and 23% on rent.
As an example , if you have had to sell falling shares and have lost 1,000 euros, you can sell rising shares with a profit of up to 1,000 euros and you will not pay taxes on them.
In the case of housing, if you sell your house and have registered benefits, it can compensate you to recover some investment in losses to pay less. This is what is called bringing out handicaps.
The tax advantage is that you can carry those losses over four years and offset them in the personal income tax for the following four years. Likewise, 2019 income is the last opportunity to offset losses from 2015 that you have not been able to settle until now.
Make a donation also income in the Personal Income Tax
Donations have a tax award . When making the rent you will be able to deduct the part of the money destined for NGOs and certain functions. The amount will depend on what you give.
Specifically, you can deduct 75% of the first 150 euros you donate and 30% of the rest. In addition, from the third year donating to the same NGO, this percentage increases to 35%.
You can also deduct 10% of donations to other foundations and associations of public utility.
Lastly, donations should not be confused with donations.
Plan the sale of shares
If you have shares and are not required to make the rent , you should make numbers before selling. Remember that those who earn less than 22,000 euros with a single payer and 14,000 euros with two or more payers are exempt from declaring if they have paid more than 1,500 euros from the second or subsequent payers.
In these cases, care must be taken not to exceed certain limits of incomes other than work, such as income or self- employment. These are the figures to watch:
Up to 1,600 euros for full income from movable capital and capital gains subject to withholding. Namely money from deposits, life insurance or the sale of second-hand products, for example.
Up to 1,000 euros in real estate income imputed by real estate other than the habitual residence, yields from Treasury bills and subsidies for VPO or appraised price and non-exempt public aid.
Up to 500 euros in capital losses.
In addition, if you are going to earn less than 16,825 in income from work (salary and pensions), it is important to ensure that you do not add other types of income such as profits from the sale of shares or rental income of more than 6,500 euros.
If there are, you could not apply the reduction for work income of 5,565 euros for work income of less than 13,115 euros. This reduction is maintained, although to a lesser extent until the aforementioned 16,825 euros.
Who has never dreamed of organizing financial life once and for all? Know that this is an achievable goal for those who control the way they spend their own money. After all, spending control is useful for many purposes: investing and making a financial return, creating an emergency reserve, buying a property and much more.
Thinking about it, we created this text to show you how to make good control of personal expenses. Thus, it will be possible to take advantage of the countless benefits that this practice brings.
Maintaining Organized Spending Control?
First of all, think about your wardrobe. To organize it and facilitate your routine, the ideal would be to separate the cold clothes from the warm ones, put underwear and socks in accessible drawers, hang delicate items on hangers and so on.
This organization takes some work in the beginning, but it makes you “earn” several minutes a day. After all, you’ll know which part of your closet is your favorite T-shirt. Not to mention that the clothes will not be wrinkled or lost, because you have established control over them.
This same logic applies to monthly expenses. If you don’t control them, you won’t know where your money goes.
Worse, without controlling personal expenses, you will hardly organize your personal finances to make that trip or buy the car you want so badly.
It is worth remembering that, however small an expense is, it must always be considered in your financial planning. So, nothing to ignore that candy bought after lunch, just because it cost a few cents. At such times, all money spent counts.
Keep Track of Daily Expenses?
Now that you understand how important it is to know how to control spending, it’s time to see how to do it in practice. A very simple way to control your personal expenses daily is by taking notes on your cell phone or using financial control applications. If you prefer more traditional methods, it is also possible to write everything down in a notebook or spreadsheet.
For this, remember to always ask for the invoice for everything you buy.
It is essential to find a way to record these costs on the spot or right afterward, OK? Thus, you will not forget the transactions you made on the day and you will be able to control your monthly expenses in a more organized way.
To make it easier, it is important to have an expense control spreadsheet. In it, you get complete control of the entry and exit of personal expenses and revenues. But remember that it must always be updated for greater efficiency.
Best Spending Control Apps
There are many available on the market and they can help you a lot to keep your accounts organized. See 3 application options for spending control below:
Organizze draws attention because it is very easy to use. In it, you can register everything that enters and leaves your account. To use it, it is not necessary to have the internet at all times – the app saves all the information entered and transfers it to the cloud as soon as a connection is established.
It can be used for free, but it also offers a paid plan, with more features. It is available for Android and iOS.
At Mobills, you can create goals, dreams and even detect what your biggest expenses are: food, electricity and internet bills, etc. In addition, it is also possible to divide your assets into specific accounts – this functionality is ideal for setting up an emergency reserve, for example.
It also has a paid and a free plan. It can be used on Android, iOS and Windows Phone.
With Meu Dinheiro, you control not only your daily expenses but also your investments and applications. It is also possible to record your goals, specify revenues and the like. It’s free, but it also offers an optional paid plan. You can download it on Android and iOS.
Step by Step to Control Personal Expenses
Want another little help to start taking care of finances? Here are just a few important steps in this process:
1. Write down all your expenses
As we said, this is a fundamental practice for controlling personal expenses. You can use any of the applications suggested above or a spreadsheet to control expenses.
To be effective in this step, make it a habit: spent it, noted it. Thus, you will hardly forget any purchase you made, regardless of whether it cost R $ 1.00 or R $ 500.00.
2. Organize expenses and align by categories
The hustle and bustle of everyday life mean that we don’t have time for almost anything, don’t we? Anyway, take a few minutes at the end of the month to organize your personal expenses.
Here, the idea is to align them by categories, such as food, entertainment, extras, parking, car, health, etc. This step may be a little boring at first, but you’ll soon get used to it. Don’t forget: all personal expenses must be registered and belong to a category.
3. Identify where the money is going and pay more attention to spending
After a while of taking the first two steps, you will be able to know where your money is going. After all, it will be easier to analyze whether you are spending more than you should be spending on food, transportation or the cable television plan, for example.
Learn to Save and Invest Your Money
After controlling finances, the next step is to save to invest. That way, you can lead an organized financial life, and this is the first stage to have a peaceful future and to be able to fulfill your dreams. So, set some goals to be achieved.
Think about what you most want: to know another country, to have a house on the beach, to buy a luxury car, to take a course, etc.
Then, take the money out of Savings and choose an application that has a more interesting income. In case you don’t understand much about the subject, know that there are many articles and even free courses on investments on the internet.
Just be willing to learn and start investing. In no time, you will learn more about stocks, fees, Treasury Direct government bonds and the like. After saving and making your money more, you can reap the rewards of your organization.
After all, the time will come when you will be able to enjoy all the benefits of spending control you have made. You will finally be able to fulfill your dreams and lead a life with more comfort and quality of life. How about starting right now?
Savings account makes the amounts deposited. Depending on the rates of return, they provide and the size of the investment occupied. Discover how they do it!
Making your savings grow alone is not a fantasy. Through the use of savings accounts, most banking institutions can offer protection to the money that you keep each month. In addition to making it invest. So, you get an additional percentage of the earnings that you initially deposited in your account.
This is how savings account work:
Select the Account You Want to Open
This will depend on the banks you have in mind to save your money. Since each one has different types of savings accounts available. Despite this, it is important that you ask the right questions to make an informed and beneficial decision.
Some examples of important features you will want to research before choosing a savings account are:
Commission for opening: that is, how much does the institution charge for contracting the savings account service.
Minimum opening amount: this refers to the amount for which you must make the first deposit to activate your account.
Minimum monthly balance: Sometimes, savings account require a minimum amount of money to serve as collateral. This avoids charging services such as account management.
Commissions for account management: The bank discounts a moderate amount of money as payment for the use of your account. Consider the amount and compare it with your savings to avoid this discount exceeding them.
Additional services: Depending on your needs. Make sure that the bank provides you with a checkbook or card. So that You can make transfers of money without additional commissions.
Rate of return: The rate of return is an amount that is added to the amount of money invested. It is established by each banking institution. It can play in your favor. Since, depending on the amount and term of your investment, it will increase savings.
Deposit Savings and Choose What Percentage You Want to Invest
The rate of return is called the amount of profit or loss. That is, when making an investment for a certain time.
Banks use these rates to increase your money as compensation for giving them the authorization to make investments with savings.
A bank in which you choose to open your account and deposit your earnings. It will provide you with a list of rates and terms. You can invest, as well as get benefits that this will bring you.
Likewise, depending on the percentage of the money you have available. The bank will let you know the performance that your account will generate.
Although it may not be much. In the end, the rates of 2 or 3 percent will end up increasing your savings.
Recommended: Advantages of Internet Banking
Pick the Term in Which Money Will Be Invested
These terms can vary from days, weeks, months and even years. Depending on the term, you decide to authorize the bank to invest your savings. The rate of return will be adjusted and will generate more long-term profits.
It is always recommended to make investments for at least a year. Since you can ensure that savings are being used and gaining value as opposed to just having them stored in a piggy bank.
Although, if a year seems too long. There are short deadlines that could also generate profits. You could spend your money immediately if an opportunity arises.
If Necessary, You Have Your Money at the Time You Want
As mentioned earlier, some banking companies provide their customers with ways to use their savings quickly and easily in emergencies.
It may be that having a percentage of it invested, the institution will charge some penalty for withdrawing it earlier.
But, it is not mandatory that you stay in the bank all the time. It is likely that you can use the checkbook or debit card. They provide you to dispose of your money.
In extreme cases, such as the fact that your bank goes bankrupt and closes. You should be calm. Since savings are always protected and guaranteed by the Institute for the Protection of Bank Savings.
Making your money move instead of being static and available to spend at the least indicated time. It will help you create greater awareness of your earnings and plan to meet your goals.
In these times, saving is a necessary activity. Whats a better way to do it? Just by savings accounts to protect your wealth and future.