Saving and Investment

We really know about how to secure your money for making our life happy and satisfied. Afterwards, we will learn the basic tips for better investment and savings for your better future. But the first thing we should remember is that there are so many of risk of loss or greater the compensation. When we talk about time value of money and our earning situation should have to be properly understood. We can do such subtractions of our spending much more besides necessities. At first, we have to be able to avoid risk, or seek high risk because of higher returns, like with futures or options, "Why might investors who ignore these principles lose money?"  When you take greater risk, your return will also get greater. What we must learn is that risk and return have a linear relationship with each other. With Return on the vertical axis and Risk on the horizontal scale, a 45 degree straight line is drawn to represents the relationship among them. For example, Bank savings and Cd's are at the lower end of the graph, Bonds are little higher, stocks will be in the middle and futures and options at the high end for high risk and high return. For instance, you purchase a stock at the beginning of the Nineties, why doesn't it have the same risk or the same reward potential if you bought it at the end of the Nineties? In addition, how can the same stock of shares have two points on the straight line if linear relationship is in existence? That's all for the theory session for saving and investment. It just runs in normal situations and, in most cases, including the classroom, but not in reality when the sheet hits the fan. For this case in the year 1999, high risk offered zero potential and only a chance to lose it all when the dot-com named bubble burst.

In investment there is a rule of thumb and that is “higher the risk, higher will be your return”.
And if apply this theory, and then it applies to everywhere. We prefer cheaper breakdown insurance, don't automatically replenish our annual travel insurance and don't pay full price for theater or theme park tickets. The home is the most expensive item you buy in your life. If you are willing to purchase a house and you are not able to pay in cash because you don’t have then make full utilization of loans. For instance, if you are paying your lender's full standard SVR you are surely paying hundreds of bucks a year more than you need to pay. There are thousands of deals available to choose from and it is very important to ensure the small print for concealed catches, and this is a comparatively easy way to save a lot of money. So that we can save at least 10,000 and we will be able to invest daily or monthly $1000. When we will be able to save then we will get investment environment and it will make our life happier.