New York, NY (PRWEB) December 1, 2006
Michael Fisher has a great deal of experience as an investment professional with ten years of experience at Goldman Sachs and Credit Suisse First Boston. He bought and sold billions of dollars of investment products on behalf of his clients and himself; he shares his expertise in his new book is Savings and Investing: Financial Knowledge and Financial Literacy that Everyone Needs and Deserves to Have.
Five 5 quick tips for saving money much faster:
1. Eliminate unnecessary expenses: A coffee or a pack of cigarettes or any other small expense of perhaps $5 per day will end up meaning a saving of 1,825 per year, which with a 5% return will turn into over $20,000 in ten years, or over $60,000 in 20 years. If we can save larger amounts per day, per month or per year, the savings will be even greater.
2. Automate the process: The best way to save is to simulate a lower income -- if the money goes into a saving plan immediately we won't even know it is gone. Furthermore, by using dollar cost averaging we can get the average price of a volatile asset down quite a bit by investing the same amount each month.
3. Start ASAP: Someone that starts at age 25 and contributes for 10 years and earns a return of 5% per year will end up with more money at age 55 than someone who starts at age 35 and contributes the same annual amount for 20 years. In other words the person that started early, only contributed half as much but ended up with more just by starting early. (If the early starter had continued to contribute, he or she would have ended up with more than twice as much as the late starter).
4. Use government tax incentives : The government wants us to save. If we save money in a pension plan like a 401k and we are in a 25% tax bracket, $75 immediately turn into $100 in the plan and we can have the money grow tax free as well.
5. Diversify: By diversifying and mixing two investments that we have strong reasons to believe will both rise in the long-term, but that do not move perfectly together in the short term, we can reduce the risk of the investment much more than we are reducing returns. Conversely, we can increase returns by not taking on much more risk. This makes a strong case not to put all of our eggs in one basket -- i.e. The US stock market, bonds, commodities, real estate, cash ,hedge funds etc.
Michael Fischer is available for interviews.
Please contact Tiffany Alvarado at 212-593-6467 for an interview or a copy of the book.
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