During my interviews with clients, I have realized that one of the main problems they face in the current situation of the country, with high inflation and a rising dollar, is the desperation to know what are the best ways to save and invest. . Many of the questions I am asked are: “How can I save if my income is not enough?”, “I don’t know how to save, where do I start?”, “What if I have an emergency and I don’t have any savings?”, “I want to achieve medium-term financial goals, but I don’t know how to do it.” And this does not only apply to people, but also to companies that may have a constant flow of money, but do not know how to manage it efficiently or do not know all the tools that the financial market can offer them.
That is why in this note, my intention is to share tips to learn to save and to start investing once we have saved. With these recommendations, you can have better financial planning and ensure lasting financial stability in these difficult times.
First of all, To have good financial management, it is important to start by developing a budget. This involves knowing how much money is available and how it is being spent. To achieve this, it is necessary to analyze our expenses and eliminate those that are not really necessary, in order to allocate that money to other more important needs.
A useful tool to apply in managing our finances is the 50-30-20 rule, which consists of “dividing” monthly income based on 3 categories of expenses and certain percentages. These are: primary needs (50%), tastes (30%) and savings for the future (20%). It should be noted that this rule is not mandatory and can be adapted to each particular situation. The important thing in this rule is to start saving no matter how much you change the percentage, every time you plan your month if necessary, rethink it again, but save!
Another important recommendation to prosper financially is the “pay yourself first” rule. This means that before spending our money, we must allocate a fixed percentage for savings. In this sense, it is recommended that in crisis situations, save in hard currency, buy dollars, euros or stable cryptocurrencies can also be used.
Second, it is important to reduce debt. If we have outstanding debts, it is best to make a payment plan that allows you to pay them off, your payment plan or your debt cancellations must always be analyzed within the budget. Debts can be a heavy burden on our finances, especially in times of crisis, so it is better to eliminate them as soon as possible, remember that it is never too late to put your finances in order and today may be the best day to do so.
Last but not least, it is essential to put together an emergency fund. This fund should only be used in case of unforeseen situations, such as a medical emergency or job loss. The objective is to have a reserve of money that allows us to face any unforeseen event without having to resort to loans or the sale of assets. The ideal thing, already knowing our budget, and taking control of our finances, is that the emergency savings can cover at least 6 months of expenses. This emergency savings must be liquid, in hard currency and easily accessible, there you can buy the mep dollar, which is currently the cheapest free dollar.
Once we have managed to save and have an emergency fund, it is important to invest money properly. For this, it is essential to have a broker account, which allows us to access different financial instruments and make investments safely. If you don’t have one, I’ll leave you a link so you can open it at no cost: https://www.balanz.com/[email protected]
It is advisable to invest in the long term, I understand the concern of many, and with the uncertainty that reigns at the moment, but there are instruments that allow you to diversify, even investing in companies from other countries. For example, cedears, which are Argentine certificates of deposit that represent shares of foreign companies. They are a good option to diversify the investment portfolio and access international companies. In addition, those shares that you buy not only allow you to earn dividends (which are the payment of the company’s profit), but you can also buy them in pesos and then sell them in dollars.
Another important instrument is negotiable obligations, which are debt securities issued by companies that offer a fixed interest rate. They are a good option for those looking to invest for the long term and earn passive income. In this way you can become dollarized, earn interest and without losing the possibility of buying dollar savings.
And finally, I want to tell you about mutual funds, which are a popular option for those looking to invest in different financial assets, such as stocks, bonds, and fixed terms. They are managed by a team of experts and allow you to diversify your investment portfolio with little capital, and with 1000 pesos you can invest. In addition, another important point is its liquidity, it allows you to get out of all the products you are investing in 72 hours.
In conclusion, learning to save and invest properly is essential to face any economic crisis. Developing a budget, reducing debt, and building an emergency fund are key steps in achieving this. Then, having a broker account and choosing the right financial instruments will allow us to obtain the best returns and protect our money in difficult times.
Do you dare to change your habits, now that you know how? We all start at a moment and it is never too late to start investing, remember that financial planning is going to be no you work for the money if not that the money works for you.
by CEDOC