Manage the available money properly

The salary came in, you paid your mortgage (or rent), food, bills, entertainment, and even put aside a monthly amount to save for an emergency. And yet, there is money in the current account. So what should you do with the money left over at the end of each month and how do you avoid unnecessary spending?

Money left in the current account just becomes a temptation and a goal for unnecessary waste. Although it is money that cannot be depreciated, and is “safe” in the current account or a deposit, it is worth considering other channels that yield a higher return than the current interest rate at the bank. Fortunately, you do not have to be a wizard in the capital market to properly manage your free money. We’ve put together 5 tips to get you started:

  1. Do not succumb to personal inflation: When the salary goes up and the basic expenses remain the same, naturally people feel free to spend more money on the pleasures of life, and here, the expenses increase miraculously. It’s a kind of “personal inflation.” That is the thought that if there is money available, then one can spend a little more and enjoy a higher standard of living. This is a mistake. The free money can serve you for far more important purposes than just another gadget or a few outings to a restaurant. The legendary Warren Buffett summed it up best by saying “if you buy things you do not need, you will soon have to sell things you need”
  2. Setting goals and objectives: Money without a purpose will probably lie in savings at best, or will be wasted at worst. Therefore, it is worth writing a personal economic plan in which you set big goals for life, and medium-term goals. Financial planning will require you to make an order and strive for a defined goal. This is the first step in consciously managing your finances
  3. Pensions, insurances, and emergency liquidity: As mentioned, it is important to put liquid money aside for emergencies. But beyond that, it is critical to start thinking about the future at an early age and plan your retirement. This planning begins with the question – what is the amount of the monthly pension payments that will help you live comfortably even at retirement age? And from there deduce the meaning of pension savings from now on (even if it seems very far away). For example, you may want to increase your deposit percentage or switch to a higher-risk (or more solid) route. The same is true of insurance. Insurance is an investment in your and your family’s future, so it’s important to check that your insurance coverage fits your current and future needs – just in case. Comprehensive insurance of a few tens of shekels a month can save you potential expenses of hundreds of thousands of shekels
  4. Understand the difference between savings and investment paths: This tip is not easy to apply. Exactly for this we have prepared in advance everything you need to know about the options of different savings and investment routes, in order to make the information accessible to you and help you understand the advantages and disadvantages of each route. It is important to gain knowledge on these issues – because after you control your expenses, you have goals and objectives, the pension is tidy, insurance covers what is needed, and even have emergency money – comes the real time of letting money work for you with smart and productive investments. The parameters that are important to understand in depth in each track are. These are the five elements that are important to compare and be critical of
  5. Smart management of available money begins with financial planning: at Mivtach Simon we offer financial planning that aims to harness the unique characteristics of each investment track to your needs.
    Financial planning begins with examining your and your family’s existing situation, setting a strategy, implementing decisions, and ongoing reporting that helps monitor and control what happens to your money. This is how money is wisely managed.

Next steps to manage your free money

As we have seen, it is important to avoid unnecessary waste, set goals and objectives for money, think about the long term, and if possible – not only save but also invest wisely.

At Mivtach Simon we offer professional financial planning that exactly fits your and your family’s needs. A Simon insurance agent will help you understand how to manage your free money and how to invest wisely, in a way that is just right for your situation and your aspirations. The questions our agents knew how to answer are many:

Is your money, which is found in various investment products such as pension savings, banks, managed investment portfolios, study funds, etc., managed correctly? Are the risk levels appropriate for your age and goals? Are all tax benefits properly utilized? What is the most efficient, profitable and accurate mix of savings and investments for you? And more and more questions that will directly affect your and your family’s present and future financial future.

Our Finance and Investment Department is at your service in financial planning and investment management. For more details with one of the investment managers you can fill out the form on the left.