Just after Double Eleven, Yi Nengjing became a hot search for her "Chopping Hands Battle Report". She posted her Double 11 bill on Weibo, which contained about 900 items. “The most expensive one is a face cream worth 10,000 yuan, and the cheapest one is a trial product for members who purchase additional products for 0.01 yuan.” The whole screen is full of rich people.

The working-class people who have been brainwashed by consumerism are also using their credit cards and buying Huabei like crazy, contributing to the historical record of "498.2 billion" on Double Eleven.

Spending money is fun for a while, but you will regret paying it back for half a year. In the next few months, reminder messages will come one after another. In order to fill this big hole, many people will start to eat dirt.

The so-called exquisite life supported by desire is often vulnerable. Some netizens joked: It looks glamorous on the outside, but it’s tight on the pocket.

Your ability cannot keep up with the expansion of your desires; the balance of your wallet cannot satisfy your ambition. Overdraft consumption has become an outlet for material desires, but after all, you cannot escape the price you have to pay. Huabei, Jiebei, credit cards, loans, each of them has flesh-eating teeth. Short-term pleasure, in exchange for long-term pain.

1. Restrain desires and consume rationally

Buddhism believes that desires can bring suffering to people.

In the National Basketball League (NBA), most players can earn millions of dollars a year. But the 60-year-old retired player declared bankruptcy within 5 years after losing his considerable income as an NBA player.

Are they rich? Most players look very rich, but most NBA players have poor financial awareness, or even none at all. No matter how high a person's income is, if he cannot still live a comfortable and comfortable life when he is unemployed, it only means that he is not really rich.

In today's era of prevalent consumerism, many people make a stupid mistake: they like to create the illusion of making themselves look rich instead of being a truly rich person. Relying on overdraft to obtain temporary satisfaction is tantamount to drinking a dove to quench your thirst.

In one issue of "Round Table School", Dou Wentao asked, when did you feel that you were very short of money? Ma Jiahui said something that is amazing: "If your desire is one yuan more than your income, you are poor."

There are many temptations in this world, such as consumption desire, hedonism, appetite, fame and fortune, etc. , are all innate to human beings. But when desire is not controlled, it is like the devil released from Pandora's box. Once out of control, it will bring irreversible consequences.

Therefore, the key to achieving financial freedom is not how much money you earn, but how you spend your income. If you can be content with what you have now, you won't be tempted to squander your money.

Kelly McGonigal, a professor at Stanford University in the United States, proposed in "Self-Control": delayed gratification. Delaying the desire for gratification can stop the impulsive devil from going crazy and allow rationality to return.

Only by delaying gratification can you experience more pleasure in life. If you want to get rich, then being frugal will definitely increase your probability of success. Especially when you are young, being thrifty is even more important.

2. Distinguish assets and liabilities

The classic financial management book "Rich Dad Poor Dad" said a very important sentence: "You must understand the difference between assets and liabilities, and try to ”

Everyone has a balance sheet, with assets on one side and liabilities on the other. If you want to get rich, just keep buying assets throughout your life. If you want to be poor, keep buying debt. It is precisely because people do not know the difference between assets and liabilities that they often buy liabilities as assets, which leads to the vast majority of people in the world struggling with financial problems.

“The rich get assets, while the poor and middle class get debt, but they think those are assets.”

These three pictures show the poor, middle class and rich respectively. A lifetime of cash flow. It also clearly explains where money comes from and where it goes for people from different classes.

Many middle-class people use the money they may have earned harder than the poor to buy liabilities that look like assets, and whether they are working or resting, the liabilities are helping them spend a lot of money.

Take real estate and cars as an example. In the past two decades, during the era of rapid development of real estate in China, you can make money just by buying a house. But in the future, houses in first- and second-tier cities with concentrated populations can only be purchased as assets, while most third- and fourth-tier properties can only be used as consumer goods.

A car must be a liability. If you buy a car for 200,000 yuan, it will start to depreciate from the moment you open the 4S store. If it is scrapped in 8 years, the car will depreciate by nearly 30,000 yuan per year. Counting all kinds of tickets, insurance, gas and parking fees, the annual expenditure of 15,000 is not too much. It is equivalent to an increase of 50,000 in your annual fixed expenditure. Therefore, for most working-class families, multiple cars are actually multiple little gold-eating beasts.

Simply put, anything that can increase in value over time is an asset, and anything that can depreciate is a liability.

To be financially insulated from risk, we must accumulate assets, not liabilities. The safest way to benefit a person for life is to spend less and earn more, and then use the remaining money to invest rationally.

3. The first step in accumulating wealth: learn to save money

If we want to become a rich person, we must have a plan with clear goals, and the most critical step is to arrange To manage our expenses, we can save money through accounting, budgeting, forced savings, investment and financial management, etc. Only then will we have money to invest.

1. If you want to save money, you must first keep accounts

Investment solves the problem from 1 to N, but accounting can solve the problem from 0 to 1. Bookkeeping cannot directly increase your income, but it can indirectly create wealth for you. Nowadays, few people have the habit of keeping accounts, but keeping accounts is actually very necessary, especially for some young people who “lose their money before they know it”. Accounting is the first step to cultivate personal financial awareness. .

Accounting has two benefits:

First, through accounting, we can understand the specific direction of funds and develop rational consumption habits. After keeping accounts, you may find that many expenditures are actually unnecessary. Money needs to be spent wisely. If you change your original consumption habits, you will become more and more rational.

Secondly, through accounting, we can also clearly understand our financial situation and carry out reasonable financial planning. Financial status includes the past, present and future, whether it is a debt status or a surplus status, the distribution of personal property, etc., so that personal assets are no longer a confusing account, so that reasonable investment and financial planning can be carried out.

2. Make a budget and put it into action

For example, if my monthly salary is 5,000 yuan, I must save 2,000 yuan, and the remaining 3,000 yuan will be used to pay you fixed expenses, such as rent, living expenses, phone bills, etc.; if there are additional expenses, such as traveling, buying bags, and clothes, then you will definitely not be able to make other spending plans this month.

Before figuring out how much money to save and invest, there is a very important question to ask: Will you still have to pay interest on your credit card?

If necessary, your investment will be meaningless. Most credit cards charge 18 to 24% of interest every year. If you cannot pay off your credit card debt in full and on time every month, you will have to pay 18% of interest on your credit card debt while expecting a 10% return on investment. Therefore, by paying off your credit card debt, you have gained 18% of your tax-free income. There is probably no investment in the world that can bring you such a high after-tax rate of return.

3. Forced savings

As soon as you receive your monthly salary, immediately deposit part of it into an investment account. Subtract your average monthly expenses from your monthly income to get the amount available for investment each month. No matter what happens, you must persist. Even if you have 1,000 yuan per month, you must save at least 10-20 yuan first. Once you develop a habit, it will eventually become a lot of wealth over time.

Remember, never wait until the end of the month to invest, otherwise you will never have enough money left to implement your financial plan.

4. Fund fixed investment can help you obtain stable and high returns

Buffett has said many times: For individual investors, the best investment method is index fund fixed investment. He not only talked about it, but also made a will, which stated in black and white: After his death, he asked his family to invest 90% of his assets in index funds.

The so-called index fund is a fund that is bought and held for a long time based on the type, quantity, and proportion of stocks included in an index. In this sense, the price trend of an index fund is basically consistent with the trend of an index.

Other active stock funds rely heavily on the fund manager's stock selection and timing abilities, but index funds are very different. Its fund manager must use the index as a reference and select the stocks in the index. Securities included. Therefore, the performance of index funds does not depend on the personal decision-making ability of the fund manager. It can be said that it is only related to the performance of the index itself.

Domestic funds are roughly divided into four types: currency funds, bond funds, stock funds (including index funds), and hybrid funds. Their characteristics are as follows:

It can be seen that , the fund's return and risk are directly proportional. Therefore, we need to avoid market risks through fixed investments and obtain average market returns by paying time costs. Because it covers a wide range of industries and is the leader in its industry (if the company lags behind in development, it will be removed from the index), its performance will be higher than the country's overall economic development level in the long run.

Fixed investment index funds are very suitable for long-term financial management by non-professionals. When you are young, you can set a financial goal (pension, education, etc.) for 20-30 years, and insist on investing a fixed amount every month. The amount is invested in an index fund to achieve ultimate wealth accumulation. The longer you persist, the more obvious the effect will be.

There are a few points that you need to pay attention to when making fixed investments in funds:

1. Try not to choose the specific time of fixed investment every month from the 1st to the 8th. Because there will be New Year's Day, Spring Festival, May Day, and National Day holidays, fund business is suspended during this period, and funds will be deducted on the first day after the holidays. Moreover, the stock market on this day basically rises, and the net value of the fund is relatively high. In addition, if you plan to invest in multiple funds, it is recommended not to set them on the same day, but to divide them evenly according to the number of days in each month.

2. Don’t buy actively managed funds. The interests of actively managed fund managers conflict with the interests of investors, and high management fees, commissions, annual fees, transaction costs and taxes will unknowingly eat up most of your wealth. Taking into account various "invisible" financial management fees, the performance of most actively managed funds is significantly lower than that of index funds.

3. Diversify investment. Since there are many types of funds, different types of funds have different risk-return characteristics and are suitable for different investors to invest in different market environments. Generally, we select 3-5 excellent funds, make fixed investments every month, and hold them patiently. Looking further ahead, we should not only invest in the domestic market, but also consider the international market.

4. Read the detailed information of each fund carefully. Factor fund management fees, annual fees, transaction costs, sales commissions and taxes into your investment account, and try to reduce and avoid these fees as much as possible. Minimize your investment and financial management costs and maximize capital returns.