Photo by: laverrue

Have you ever wondered what a brand new technology device would cost you in the long run? It’s usually something we tend to avoid viewing, but it’s actually what keeps us from growing a wealthy portfolio.

Looking at all the things that tends to eat up a big portion of out earnings isn’t something we do that often, but when I came across this interesting share calculation …click to continue reading What To Learn From A $12,319 Lesson

Looking for ways to grow your portfolio more successfully? Then read on and learn the 5 simple steps getting your personal investment to its better in a more secure way.

• Divide your investment between several investments. You can never be too sure nowadays, although learning by our mistakes is probably the best way in learning. Ask any professional investor, they have probable gone through a period in their career where they had to loose their account before they were able to realize the mistakes. Don’t make this mistake yourself! Try to have an open mind and divide your funds with several investments.
• Avoid investments products that are too complicated. It does not mean you are stupid to understand, but more rather the provider or financial advisor is trying to play you a game.  Walk away.
• Rule of thumb – Never borrow money to invest in volatile markets, such as forex, share markets etc. Invest what you can afford to lose although the risk my seem low at a point, but you never know in the volatile conditions.
• The best investment you probably can make is to repay debt. Take good care of your money. Spend them wisely and invest some of your time in learning to manage your OWN investments more profitable in the long run.
• So called “experts” says the best investment in year 2009 will be in real estate. Naaa…I wouldn’t go buy that one yet. Unless I had a bunch of millions laying around, I’d maybe consider it in the late 2009 when we’d seen how much deeper this mess gets.

Until then I’ll be focusing on my best personal investments who gained me from 50-100% last year.

Are you interested in learning more about investment? Let me know by leaving any questions or comment below.

Recently I stumbled over an interesting calculator at NYT which compares the costs of renting and buying equivalent homes at today’s date.

Let’s face it, the economic drop has pushed the prices to an lower point, but I still don’t think we’re not quite yet at the bottom. Taking it from another point of view, an historical chart of the housing values back from the 1890’s and to the point where the market hit top – we get a clear view of the uptrend situation till year 2006.

A pretty straight up trend rising about 83 percent from its low in 1997. As taken from the old saying “The trend is YOUR friend, till the trend ends” – making this picture a great view as a whole prospective. It wouldn’t be possible to continue an uprising trend like this, and it were only a matter of time before the trend had to reverse and take a dive back down.

I think the market will need a few years to really recover from this financial crises and we’ll likely have to wait some time before we’ll start seeing some good rising again.

For the last few years I’ve been an fan of renting thinking that I should avoid having a large sum of my net work tied up to some kind of housing speculative bobble soon to burst – I kept my focus on growing my portfolio and business instead.

On the other hand, when renting you’re building someone else’s equity and the time comes where you should consider start building your own. Renting costs has also raised, and will continue to do so as long as the economy crises continues.

Here’s how to measure the cost of renting and owning.

1. Find a house for sale and a similar house for rent in a given area.
2. Take the cost of buying the house and divide it by the annual cost (monthly rent x 12) of renting the similar house.
3. What’s left is the price-rent ratio.

In the early ages of 70′s, 80′s and 90′s, we had an average of price rent ratio between 10 and 14, and by the time housing market hit top in 2006, the p/r ratio almost reached 19.

With price rent ratio around 20, to even 30 in some exclusive places the last years, we are hitting lower as the house prices keeps dropping and rent rising. Historically we’re still high, but seeing where the market has been a few years ago makes it a different view.

Being a long-term investment, owning a home, will be one of my list of things to accomplish within the next years to come. With renting continues rising it will be a wise thing to watch the p/r ratio.

Currently the p/r ratio in my area is a currently about 19, which I think is a little too much, but I’ll keep an eye up for changes happening.

Till then, we’ll have to keep the focus on thinking wise and growing our funds in a good effective way of investing.

A History of Home Values by Robert J. Shiller – NYT:

I hope you found this article helpful.

I’m also interested in knowing how the situation in your area of living is. Leave a comment below and we’ll share our view from different places around the world!