UNDERSRANDING HOW TO MANAGE MONEY - Part 1

avatar

WHAT IS MONEY?

Money can be defined as anything or any item that purposely serve as a means for exchange. It is generally accepted for all form of transaction of goods and commodity. Money can be in form of currency which can be online currency like bitcoin, litecoin, gram, etc. or physical currency like Naira, Dollar, Euro, Pound, etc.

MANAGEMENT OF MONEY

Money can be managed well by each individual by considering some of the thing listed below.

1.) USING MONEY TO RUN A PROFITABLE BUSINESS

WHAT IS BUSINESS?

Business is the act of releasing money as capital in expectation for it to multiply and make income. Money are needed in business for buying goods ahead hoping for an increment in price of the commodity and then resell it to make profit at the end of the sale.

Money are also needed In business for buying shares in companies. Money is also needed in business through banks especially commercial banks. Anyone with excess money that wants to keep for future use and make profit within that period can walk into any bank of his or her choice and open an account with the bank if possible, fixed deposit account and save the cash for any period of time.

download (5).jpeg

Image Source

While the cash is saved, banks keep adding interest monthly for the duration agreed, eventually, when the time elapsed, the depositor can collect his or her savings and can also collect the interest which is serves as a profit for him or her.

Man power are needed in business in the sense that, one can decide to use his or her power and time to work for someone and get paid at the end of the service. Work rendered to someone is also an business because he or she get paid for the services rendered and thus, make profit.

Properties like Houses, cars, any form of machines can also serve as means of business. When a house is built by someone and then rent it out to someone else, the tenant have to pay for the rent due and then tends to make more money for the person that rent the house out to him or her.

FACTORS TO CONSIDER BEFORE STARTING A BUSINESS TO AVOID MISMANAGEMENT OF MONEY

Risk and Reward

Risk in business means the probability to make loss or profit while reward is the profit gained from the business. In every business, there is always a risk that is, the chance of making profit or loss.

But a reasonable business man should be able to analyze the percentage of the risk and reward. One can easily predict risk by studying the economy at that moment, the community, the government and most especially the demands and supply of what he or she is planning to invest on.

If at the end of the analysis, the risk of the business is bearable then one can further the process of the business but if the risk is not favorable, he or she should stop the processing of the business to avoide loss and then change plans or find something else to invest on and make sure that the new business is favorable before investing on it.

Available Capital

One should understand that money is the root of a business. He or she should calculate the estimated amount that will be needed through out the business and compare it with the money available on ground for the business. The business is good to start if the money available will be enough through out the business and the business should be canceled if there is no availability of money to run it. Though some business mans take risks to start their business with any amount they have on ground as at that time but its very risk and a game of chance and luck because the time the business will need more money, there might be no money with the business man and that alone can run down the business and result in loss. In the casa of low capital, the best solution is to wait till you have enough capital or find another form of business that requires low capital and invest in it.

Thank you for stopping by to read my article.

If you actually like what you see😃😄😉,watch📷📺📸 and read📖📋 I would equally be grateful for an upvote♥️⚡ a very cool comment under my comment box or a reblog 🌀😏 for everyone to see ... and perhaps maybe you would like to follow me for more of my Post to show on your own feeds. Don't miss any of my Post.🔝. Special thanks to all who put big smiles on my face with Auto Upvote for always being supportive to me 💞💯.



0
0
0.000
1 comments
avatar

Muy bueno tu post, saludos desde Venezuela

0
0
0.000