13.8.12

Invest, Earn, Reinvest?

Think about this question.

After you invest into a profitable investment,
Yes! You earned that profit.
After that, what will you do with that profit?
Reinvest? or Spend and enjoy?

Once you reinvest, you are taking the same risk again.
If this time you make a loss equal or greater than the profit you earned,
Your effort would be wasted isn't it?

On the other hand, you spent all the profit you earned.
Yes, you rewarded yourself after taking the risk.
But your capital will not grow,
if you don't grow your capital, your earnings will always be the same.
When inflation and time value of money comes in, your earnings are depreciating!

So, what's the solution?
Jewish people has a teaching. Always save 10% of your earnings.
You deserve to spend all the other 90% of the profit!
The 90% of the profit not only used for entertainment,
Part of it can used as insurance/purchase one.
Which can used to cover the losses. (in case your investment failed)

Earning money is never ending, but you can enjoy your life only once.
Find a way to earn the money, grow your capital, and enjoy your effort.


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