Saturday, August 14, 2010

Why invest?

People invest their money for a variety of reasons. Some people invest to get rich. Some just want a little extra income. Other people want to save for retirement, or save for a major purchase. Knowing the reason for investing will help determine what kind of investment to make. Personally,
I want to get rich. Meaning, I want to have enough time and income to be able to do and buy what I want, when I want. That's a very big goal, and a little vague. It's a good reason to invest, everyone could use more time and freedom. The problem with such a goal is that it seems overwhelming and unreachable. A lot of people have similar goals, but they never start working on it because they don't know where to start.
What I did was break down the big/vague reason into more manageable chunks. Here they are in no particular order:
1. I want to save enough for retirement without relying on an SSS pension.
2. I want to create passive income that will help pay for monthly expenses. Eventually this should pay for all monthly expenses.
3. I want to be able afford to regularly donate to my favorite charities.
4. I want to save enough for my children's education.
5. I want to travel.
6. I want enough passive income to be able to enjoy work without worrying about making enough money. Work should be about doing something you like and contributing to society, not about how much you make.
7. I want to create jobs.
I'd never written these goals down before today, but I have been thinking about them for a few years. I realized just now that I should have written this list a long time ago. Knowing what you want will help you achieve it. Your goals and your personality will determine what investments you should make. I'm glad I wrote this post today. I hope it helps someone else organize their thoughts too.

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