Capital For Investing

1. Savings.
   You need to be able to make a saving from your current income. It does not matter how much it is: 10%, 5%, 2% or even 1%. You set yourself the level of saving and stick with it. Once you’re comfortable, increase the percentage. If you cannot save, there is very little hope that you can be successful in investing.
2. Selling.
   Quick easy way to get some extra money is to sell something from your household that no longer needed but still sale-able. For example: those old toys in garage, spare TV in bedroom, that unwanted gift from friend, your stamp collection, etc… You can make a garage sale or simply sell it on online auction such Ebay. It may be not much, but you could easily score some decent amount of money as well.
3. Tax Minimization.
   Claim all benefit, deduction or tax offset that can be legally achieved from your tax system in your country. Usually tax law is very complicated matter and can easily change over time, hence if you usually do your own tax, try to hire a good accountant to make sure a tax minimization.
4. Increasing Income.
   Try to increase your income by creating value to your employer. Hence you can talk to them and negotiate a pay rise. Or maybe change your job to a better paying one. Take a course that can enhance your salary. But once you can increase your salary, do not change your lifestyle as yet, put all the increase to your ‘investing bucket’ first.
5. Other People Money (OPM).
   This refers to bank or other financial institution. Have you ever think about getting personal loan to invest ? Maybe it’s time. Remember for most country if you borrow money to do investing, the interest that you pay might be tax deductible (reducing your tax) – so you’re end up with cheap loan – check with your accountant.
6. Using Equity.
   This is what refer as creating money from thin air, just like a magic. If you have your own house or property, have it re-valued. If the value is higher than the current mortgage, you can take this ‘equity’ and the bank will give you cash as a loan with no additional security.
7. Using Parent’s/Somebody else’s Equity.
   This is basically the same as action 6, but the property belong to your parent or somebody else that trust you and can give you long term ‘loan’ in the form of their equity for you.
8. Manage Superannuation (Australia) / 401k account (U.S.) / retirement saving scheme.
   This action is highly depended with the current law in your country. In Australia, every employer need to contribute 9% of the payment to a retirement saving scheme called ’superannuation’. If you work long enough and your superannuation have substantial money, you can have it managed by yourself. Although there are some legal cost, but you avoid the fee from your superannuation company and you can do better investing that produce better return for your own super.

You can do 1 or 2 or all of the actions above to get you started investing. All is up to you. Remember knowledge is not power, but your action is.

I also really encourage you to obtain the reference book below to get more clear understanding. Especially the fact that it will not cost you any money. There are a lot of content that can be absorbed from the book to kickstart your investing journey. Feel free to proof me wrong once you read the book.

Reference: “What I Didn’t Learn AT School But Wish I Had” by Jamie McIntyre. The digital version of this book can be obtain legally and free of charge by clicking here.