True Capital Cost

June 14th, 2012

There’s this argument, that financial management (in this day and age) is something beyond the average capability of a citizen. We don’t expect people to be doctors right? [discussion & podcast here]

I think one simple lesson would help – that is establishing, what does it cost us to hold or spend money?

What happens to money when we hold it? What happens to money that we spend each week versus give to an investment advisor? Who performs better? (and it can be either or.)

What happens when we spend money on lotto tickets versus savings schemes? What happens when we buy a tv via hire purchase versus cash.

How does that capital earn a return. Is that return good or sub par?

What is it that we own? Are we doing the right things for us? If not maybe should we have someone else manage it.

Mostly looked at by accountants but should be done by us individually.  Taught at a personal level.  At a younger age.


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