Financial management has goals, such as the future quality of life for the aged or children's education, or the growth of specific wealth figures. And getting rich seems to be the sooner the better, the sooner the better.
Financial management has a clear goal and a time limit to achieve it, and getting rich is a mentality of wanting to get rich overnight.
Why is investment fund the first threshold of financial management?
What is the ultimate goal of financial management? Realize passive income. How can we achieve passive income? Accumulate more and more assets.
What is an asset? What we usually call lottery tickets, precious metals, futures, foreign exchange and so on are not assets. The three assets we usually talk about are real estate, bonds and stocks.
The first asset type: real estate.
Many people are keen on buying real estate. The real estate threshold is relatively high and the liquidity is poor.
Now the investment in real estate in first-and second-tier cities is very different from that in third-and fourth-tier cities. Even in the same city, investing in real estate depends on many conditions and different values.
A city's population inflow, traffic conditions, whether there are schools, whether there are large community business centers, etc. If you buy a rent, it depends on the rental rate of return.
It takes a lot of time to really invest in real estate. Think about the future property after buying it.
Real estate investment is only suitable for some people.
Why do investment funds manage money?
The second asset: bonds
Now many bonds, especially high-quality bonds, are not open to individuals. Ordinary people can only buy bonds through funds.
The third asset: stocks
Many people want to dig a bucket of gold in the stock market, hoping that the assets of the bull market can be multiplied several times. But as we all know, in the stock market, seven losses, two draws and one profit. Although not so absolute, there are only a few people who make money. Rushing into the stock market to make indexes often doesn't make money.
But there are still many high-quality listed companies, and the big bull stocks that have doubled in ten years have always existed, all of which are of investment value. If you don't participate, you will miss the investment opportunity in vain. If you participate, will you definitely make a profit?
How should I choose such a company?
We can't choose one, we can choose 50,300,500. In the combination of these companies, companies with poor performance are constantly being eliminated, and high-quality companies are constantly being supplemented. This is what we usually call index funds.
For example, SSE 50, CSI 300 and CSI 500. SSE 50 was selected as one of the top 50 enterprises in Shanghai Stock Exchange. Shanghai and Shenzhen 300 were selected as the top 300 medium-sized companies in Shanghai Stock Exchange and Shenzhen Stock Exchange. Shanghai and Shenzhen 500 is a medium-sized company ranked 30 1 to 800 in Shanghai and Shenzhen stock markets.
Why do investment funds manage money?
Fund investment is not for getting rich, nor for getting rich overnight. It is to rely on assets to have continuous passive income. With time and compound interest, more and more wealth will be accumulated.
Buffett said: "The fund allows small investors to invest and manage money like big investors. Compared with direct investment in stocks, investing in stock funds means that you have embarked on road to riches, but you don't have to control the steering wheel yourself, you can let others drive for you. This is especially suitable for investment areas that you are not familiar with. "
The fund's fixed investment is most suitable for the public lazy financial management. Every little makes a mickle, gradually increase passive income, and have cash flow without work.