Here I’m going to illustrate my personal financial report followed by my monthly investing allotment “plan” (M.I.P.)
I earn approximately $5,000 a month. $60,000 a year, approximately. I am fortunate that I have a stable and reliable income at my age to use as a foundation to build my investment portfolio. But there are expenses…
My current (approximated) monthly expenses:
Vehicle & Insurance – $650 (wonders of driving in my age in California)
Rent – $750 (small studio apartment)
Utilities – $200
Food & Gas – $450
Education – $350
Miscellaneous – $300
Total Expenses = $2,700
Income After Expenses: $5,000 – $2,700 = +$2,300
Not bad. Realistically, my expenses monthly vary because I do provide financial support for my mother and some other family members from time to time, but it still approximates to what was stated above.
Also, I dedicate $500 a month to my “Buy A House” fund (important asset), and an additional $500 a month to a “Oh Shit!” fund.
Actual Dollar Amount for Investing:
This leaves me with about $1,300 a month. Leaving the $300 for a buffer of safety, I plan to invest $1,000 a month to build a high-yielding portfolio. About 20% of my total net income.
In theory, in 5 years X $1,000 monthly investment with an average 5.5% dividend yield (since I’m personally seeking the highest yielding stocks on the market) – I’ll be raking in $3,300 annually/$825 quarterly from dividends.
Seems like a good starting point. Although I know plans don’t always go, well, according to plan, I’d rather have one than not. Especially with finances, it is easy to get swept away in the consumerism and spend all of our hard earned money. But those days are over for me, it’s time I start making my money work hard!
What is your M.I.P.?
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