A lil' doc to help you understand savings and investment


(Niki Mukhi) #1

Hey guys!

As I spent much of 2017-2018 learning about finance, I realised that once you understand a few basic rules, how simple it can be to start building your financial freedom.

I spent a little time over the new year putting these learnings into a little doc for my family and close friends, and thought it’d be nice to share here for anyone who’d like to have a read.

If you’re finance-y inclined this may all seem trivial, but I wanted to share it for any of us that aren’t, because these little things can save years of hard work (literally)!

I hope it’s useful for you!
Niki :heart:

The realest reason to take care of your personal finances is to gain the freedom to do more of what you want, whenever you want, with whomever you want.

The goal of this doc is to show you how to get started in 25 minutes.


(Jack) #2

Great work! This is something I’ll definitely read, thank you for spending the time to put it together :slight_smile:


(Niki Mukhi) #3

Hey Jack,

Thank you! :slight_smile:
I hope there’s some useful stuff in there for you.

Niki


#4

Nice one! Will read this later


(Stefano) #5

Downloaded! Thank you in advance for this, will read this evening.


(Richard) #6

Superb. Thanks for this. Will give it a read later.

Love this community. Everyone willing to help each other out!


(Niki Mukhi) #7

@LifeofRiley @neovo @stefanocarlo
Thanks guys :slight_smile:
I hope you like it and it’s useful stuff.
Thanks!
Niki


(Bruce) #8

This is amazing dude! Feel free to fire me a £ request and I shall buy you a pizza for the efforts as very useful


(Niki Mukhi) #9

Haha love that! Thanks for the kind words, glad it was a useful read :slight_smile:


(Richard) #10

Ok…I will buy you a pizza as well.

So question…what stock trading game would you recommend to learn about managing the stock market?


(Ewan Hardingham) #11

Young and completely new to long-term investment ideas. Thank you so much for this valuable advice.


(Tom Halloran) #12

This is fantastic @nikimukhi thanks for sharing!

+1 totally agree with this. Personal finance I think to many people can come across a little boring, or technical, or just something that you are ‘supposed’ to do. Actually as you say its really all about enabling you to have the lifestyle you want, which is much more inspiring!


(Niki Mukhi) #13

Haha thanks guys, loving the pizza offers (you guys clearly planted a seed as I ended up at Pizza Express tonight) :heart:

I don’t know of any stock trading games, but I do know that many platforms allow you to create a ‘fake money’ portfolio to practice investing (like on Interactive Brokers, or at fool.com)


(Niki Mukhi) #14

Hey @EwanJon Thanks for the kind words!!
Really glad it was a useful read :slight_smile:


(Niki Mukhi) #15

Hey thank you @Tom-H… Exactly that :heart:


(Patrick Feltham) #16

Nice guide. :+1:t2:


Who invests in the Stock Market?
(Phil) #17

Thanks. Perfect weekend reading.


(Stefano) #18

I finally got around to reading the document, first of all thank you so much for doing this, it was such a lovely little read. While a lot of things may seem obvious, I realise they really are not that obvious so it’s great to have this information in one place, explained in clear plain English :raised_hands:

Question 1: do you think a life insurance is really necessary, if you don’t have (or planning to have any time soon) any children/spouse/mortgage?

Question 2: you don’t mention pensions as a way to save/invest money. What’s your view on this, also considering the updated 8% minimum contribution, with at least 3% from the employer, starting this year? (I appreciate the document takes an international approach, but I assume most people here have their finances based in the UK)

Question 3: how do you make a will legally valid? Can I simply write one using your template, sign it, and put it in an envelop somewhere safe?!


(Niki Mukhi) #19

Hey @Stefano, thanks for reading and your kind words!!

To answer your questions:

Question 1: do you think a life insurance is really necessary, if you don’t have (or planning to have any time soon) any children/spouse/mortgage?

There are a few things to consider here, especially as life insurance isn’t just for your dependants, but also for you incase of critical illness or disability (both of which can be financially devastating).

  • Does your current employer provide some life insurance coverage?
  • Where do you live? Regarding critical illness or disability, if you are in the UK and have access to the NHS, they would cover the main health related issues, but will not give you a lump sum to help supplant your income. This lump sum is important because in these cases one would likely need funds to make adjustments to their home and live on during a period in which they may not be able to work. (I live in Dubai where I don’t have access to any public health services, so getting disability and critical illness cover was really important for me).
  • If you’re considering having children anytime (even if it’s not soon), I would say consider getting a policy as they are cheaper the earlier you set them up (I set up mine 10 years ago when I was 24, and am incredibly happy today that I did that).

However, if you do have access to public health services (e.g. the NHS), don’t have dependants (and plan not to), and don’t have debt (such as a mortgage), then you can choose to not get life cover, and consider just the critical illness and disability cover.

Question 2: you don’t mention pensions as a way to save/invest money. What’s your view on this, also considering the updated 8% minimum contribution, with at least 3% from the employer, starting this year? (I appreciate the document takes an international approach, but I assume most people here have their finances based in the UK)

That’s a great point, in short, this sounds great.

I think as much as possible you (and/or your work) should contribute to your pension, and build your own savings/investments independently.

This adds more diversification, will likely reduce your taxes later on, and hopefully enable you to retire many years earlier. :slight_smile:

Question 3: how do you make a will legally valid? Can I simply write one using your template, sign it, and put it in an envelop somewhere safe?!

This will depend on where you live. If you are in the UK, it involves getting signatures from two witnesses and storing it somewhere safe (e.g. with your solicitor or at your bank).

Here are the UK Gov guidelines for this: https://www.gov.uk/make-will

Thanks! Niki


(Niki Mukhi) #20

@icedcoffee Thank you!! :slight_smile: