Brad Reifler has been an investor for a couple of decades now. Through his time in business, there are lessons that he has learned and would like to share with people that are thinking about investing, especially the younger generation. He states that following these principles are the foundation that can help one start creating a great portfolio as early in life as possible.
Creating a budget
Brad states that just like businesses make an annual budget, the individual needs to come up with a monthly budget they will be following. The budget will factor in the amount of money they are earning and the fraction of that money they want to be spending on the different parts of their needs.
According to Market Wired, Brad Reifler states that having a good culture of saving is recommended, but it would even be better if they had a culture of reinvesting the little they save for better returns.
Understanding net salary
One thing that one would think is common is the practice of people looking at their pay stub to figure out how they earned. He states that it is very important to look at one’s pay stub.
This is what reveals how much you earned, how much you paid as federal taxes and the net amount you are to receive after the payments. Crunchbase revealed that these deductions are the reason Brad Reifler states that one gets paid less than they actually earn.
The role of compound interest
The greatest thing about making savings for retirements is that the money earns interest over time. As you continue saving, the interest becomes part of the savings, creating bigger saving and more interest.
This means that by the time one retires, they will have a good amount of money in their accounts by the time they get to their retirement.
The other principle Brad Reifler advocates for is the creation of a good credit history. He states that while it is possible for a student to have a poor credit score and still get a loan, it will be close to impossible to get a mortgage with poor credit. Getting finances in order will help one avoid a deepening debt trap.