Being financial responsible has never been more important than it is today. With the economic down turn, there is less stability, questionable opportunities and general untrustworthiness of major banks and financial institutions. It is time to take your own financial planning and investment into your own hands. Here are some guidelines for good financial planning and investment.

The key to financial planning and investment actually begins before you plan or invest. It is accumulating a margin of safety. It is developing a savings. They key to financial planning and investment is to always save more than you invest. If you do this, no matter what happens to the market or your investments, you will not go broke. We have seen first hand now how a credit based society no longer works, and more and more families and individuals are learning that you cannot live check to check.

So, what does this mean for financial planning and investment? Simple. Find ways to increase your income or, more likely, decrease your expenditures so that you balance your budget in a favorable way – you need a surplus. Now, this surplus is for investing, you really need to be planning a monthly deposit into your savings account as part of your budget, before investing the rest of your money.

So what sort of advice do I have for your financial planning and investment? Well, now that you have most of your extra monthly cash going directly into a no-risk, low-return savings account or other similar investment, the rest of it should be either in similar no-risk certificates of deposits or treasury bills, or it should be in the most high-risk and lucrative investments you can find. See how having a safety net can free you up to take a chance? There is no such thing as a medium risk investment – so shoot big, but only if you have the security that your other investments give you. Frankly, I think that your balance between no-risk, low-yield investments and high-risk, high-yield should be something like eighty-five percent low-yield and fifteen percent high-yield.

Sound financial planning and investment is not a hidden magic, dark art, or insider secret. Knowing how to invest is simply a matter of protecting yourself, and maximizing your opportunities. Again, the key to financial planning and investment is to plan for small growth that will yield big results in the long term and risk a very small amount or percentage for big gains.

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