MIND YOUR MONEY A Strategic Guide to Financial Freedom

BY HARIS HAMSA

First Edition

Copyright 2006. Haris Hamsa,

All Rights Reserved
A NOTE TO THE READER THIS PUBLICATION IS DESIGNED TO PROVIDE ACCURATE AND AUTHORITIATIVE INFORMATION WITH REGARD TO THE SUBJECT MATTER IS COVERED. IT IS SOLD WITH THE UNDERSTANDING THAT THE PUBLISHER IS NOT ENGAGED IN RENDERING FINANCIAL, ACCOUNTING, OR OTHER PROFESSIONAL ADVICE. IF FINANCIAL ADVICE OR EXPERT ASSISTANCE IS REQUIRED, THE SERVICES OF A COMPETENT PROFESSIONAL PERSON SHOULD BE SOUGHT. All rights reserved. For permission to reprint or reproduce any portion of this book, please contact the publisher.

Published by H2 Publications, My Home Mount view Apts., Navodaya Colony, Yallereddy Guda Hyderabad 73 Andhra Pradesh India

Cover design by Printing and page design by

Edited by Prof. Raghava Menon

To Blessed Memory of My Grand Father

Acknowledgements
My sincere gratitude goes to my parents first, especially to my mother. I have nothing in my life to substitute with your unconditional love and care. I really love you both. To my wonderful sister and her husband, thank you for being an inspiration for me. To Mr. Gadda Naveen (M.D., Navanomi Realty Project, Hyderabad), this would not have been possible without your support and encouragement. Thank you very much. To my teachers, thank you for molding me as a life long student. To my editor, Prof. Raghava Menon, who has shown much patience of a saint throughout my many additions, deletions and revisions. I also want to thank the authors, speakers and mentors who continue to have a great effect on my life. Thanks to all, you are a true blessing, your help made it all possible and I am truly grateful for your support.

CONTENTS
Acknowledgements
Contents

Preface Whats in this for you

1) Financial freedom

Financial Bondage What is financial freedom? 2) Compulsive Spending

Some guidelines for rational spending

Smart purchases BARGAIN??? YES!!! How much percentage of your income you can spend? Increase your income
Career Choice 3) Budgeting

First Steps to Budget Daily Spend Record Monthly Budget Sheet Budget Counseling
4) Debt Management

Debt.What is that? How people fell into debt?

Signs of Caution

Good News Consequences of being in debt Credit Card

Advantage of Credit Card ownership If you are behind When should I start to worry about my debt? 5 steps to reduce Debt Some practical steps to escape from debt trap
5) Saving

Objective of saving Objective of Investment Eggs in the basket Retirement Plan Unique issues for women Schemes and Scams Protect Yourself 6) Last Word

Preface
Thank you for selecting this book. I hope the ideas in this book will help you as much as they helped me and others. I also believe that this book will make your financial life brighter. Time is never late to take corrective and preventive measures to get into the world of financial freedom. Whatever may be your present financial status, it is absolutely possible for you to make your life financially secured by following the principles described in this book. You can gain the control of your finances and your life by changing the way you manage your money. You can exercise your freedom to abstain from activities that undermine the financial well being of you and your family. It is possible that you might already have knowledge about these principles. But this book will give you more awareness and teach you how to implement it effectively to get better result. All the principles, techniques and ideas are logical, proven and practical. Each and every strategy in this book is focused on increasing your financial stability, check the outward cash flow and accelerate your journey to financial well being. The faster you learn and apply them in your life; you will be distancing yourself far away from the nightmare of financial worries Wish you all the success Haris Hamsa Hyderabad, A.P. December 2006

Whats in this for You

The

great aim of education is not knowledge but action

- H erb er t S p en cer

Dear Reader, Just imagine that now you are free from all debts, and financial worries. Try to think about the freedom and peace of mind you would have in such a situation. Think vividly even about the small details that would do to mark that wonderful moment. Of course it would be a great time to rejoice and celebrate. All through our life we are longing for that

spectacular moment. Unfortunately majority never experience that in their life.

All of us can learn other behaviors from a young age, too like how to handle money. W e observe our parents and the

world around us and come to some conclusions about money management. The three main bad habits adults develop in the area of finances are:

A c ons umpti v e l i fe s ty le P oor budge ti ng (or no budge t a t a ll ) De bt

Our lack of knowledge, coupled with lack of action, has left us financially squeezed. Only 3% of the Indians actually have a financial plan. Only 1.2% of teachers thought that they had enough training about financial issues at the academic level. Debt has become a way of life for many individuals as well as our nation. The following quota tion summarizes the

dilemma. First we are manipulated into buying what we dont need. Then we cant pay for it. Then we dont even have a place to put it. Then we dont have time to use it!

Learning to mange your finances is a journey that will take patience, planning and the constant recommitment to do what you actually want, no matter what everyone else doing. It is tempting to think that abundance in wealth will answer every problem. But many people, who have much wealth, while

achieving financial independence, do not experience financial freedom. I do not consider financial freedom as the amassing of huge sums of money or other possessions. Fortune does not equal freedom . Financial freedom is being f ree of worry or concern about financial matters. If you have no choice in matters that affect you financially, you do not have financial freedom. If your ethics troubles you because of the manner in which you have obtained your finance, you do not have

financial freedom.

How this book w ill HELP you?

This book does not cover the details of various types of bank accounts, mutual funds or share market. From this book you will the get the logic and wisdom to handle your money efficiently. This book will provide you some excellent ideas to escape from debt trap. Through some simple and practical steps you will find how to make a monthly budget, how track your expenses, how to nurture the habit of savings, how to plan your retirement in advance etc. Most importantly it will give necessary guidance for anyone, who wants to escape from the deep financial crisis, with proven, realistic but simple steps. The goal of this book is to help you to discover your sabotaging behaviors so that you can avoid financial pitfall and

get on the path to prosperity. The strategi es will help you make the most of your financial resources through wise investment and avoidance of scams, schemes and debt pitfalls.

How to USE this book? Mark the points! Make some detailed action points at the end of each chapter. After completing the book, summarizes your action points for the entire book on one paper. Keep it as handy so that you can look at it weekly and check things off as you act. Reread the entire book a few weeks after you finished the first reading. W e never grasp everything i n one reading. Most importantly apply its principles! Stop doing things that destroy your financial life! Jump into the action zone so that you may have bright financial future!