By this, I mean that you need to do more and more with less and less. In the financial sense, you need leverages that make you more money in return without exerting any or too much effort on your part.
Here are just some of the common financial leverages you can use in order to achieve your financial goals, may it be for security reasons or a strong desire for comfort and luxury:
- Savings
Savings is a form of financial leverage, because there is some magic to be found in “compound interest”. Compound interest is earning interest on the total of an original principal sum and interest already earned. Obviously, one great thing to tell you here about compound interest that all the money requires no extra and work on your part. Once it has been deposited into your bank account, your money is the investment play field – where money works for you to make more money! But remember that compound interest can only work its magic if you give it time. So, start saving now, if you have not started yet! - Insurance
No, insurance is NOT a money-making vehicle, and you might find it strange that I consider this as a financial leverage. But think about it: if you (the bread winner especially) die today or you have lost a VERY BIG money-making asset to a natural disaster, theft whatsoever, you will be begging your insurance policy to help insure the losses!
In a nutshell, insurance help transfers the financial risk from one party to another. We trade a small loss to avoid catastrophic ones! Some perceive this as a sort of bet between the insurer and insured on a loss or death, but this could not be further from the truth.Insurance can be divided into two general categories: life insurance and general insurance.
Life insurance is defined as a contract which pays an agreed sum of money on the happening of an event, dependent on human life. General insurance, on the other hand, covers individuals and third parties against risks of damages or loss on events on based on human life. They may protect an individual, property or business.
For more information on insurance, you will do well to consult your personal financial planner.
- Business
The returns from a business can be phenomenal. This is strongly recommended for you if you want to join the ranks of the rich. If you dream of making big bucks, then you have to be in business.
It does not matter what KIND of business, but as long as you are in business, you can join the ranks of the rich. What matters, though, is how you perform in business.
- Real Estate
Now, here is yet another proven, time-tested leverage that the rich use since ages ago to become very rich. Leveraging finances using real estates date way back to the times of royals and dukes.
It makes “cents” anyway, because you are probably living in a leverage yourself, you can use it in your favor to help leverage your financial position.
A word on leverage: while there are several leverages to be used in order to elevate financially, you should treat leverages two-ways. Leverage can be great if used correctly. On the other hand, leverage can also be used against you if you misuse or abuse it. Simply put, treat leverage as a double-edged sword!
