It is the use of certain principles to record, classify and summarize financial data in monetary terms and economic, to report in a timely and reliable operations of the life of a company.

The main function of financial accounting is to bring in a historical economic life of a company, records of past figures used to make decisions that benefit the present or future. It also provides the financial statements or financial statements that are subject to analysis and interpretation, reporting to managers, to third parties and state entities for the development of business operations.

Its features are:

- Reporting to third parties on the financial transactions of the company.
- It covers all business operations in a systematic, historical and chronological.
- Necessarily be implanted in the company to report the facts promptly developed.
- Language used in business.
- It is based on rules, principles and accounting procedures for recording financial transactions of a business.
- Describe operations in the analytical gear of double entry bookkeeping.

Like any other type of plan a personal or family financial plan is a logical process which sorts the objectives and steps to achieve them. Importantly, a flexible guide to be adjusted from time to time to get adapted as reality changes. Any plan is a way to chart a course that serves as a compass, but when obstacles or unforeseen things appear is important to change direction.

The Financial Plan is a document that, basically, explains the objectives or goals that the individual has and what are the steps to achieve them. This document has a title page, index and contents of the plan. For example the index of a plan is as follows:

Introduction
Current Situation
Objectives
Proposed Plan
Implementation
Monitoring
Conclusion and Appendices
The financial planning process can be divided into two parts: planning and Exhibits usually returns a little more comprehensive.

The Planning Process will show the current state of affairs of the individual, cited the goals or objectives and words will the proposed plan, implementation methods and control points or milestones for monitoring the implementation of the plan. These control points or milestones, goods may be in amounts, ie something like: In one year the accumulated is $ xxxxx.

Annexes will be in charge of “showing” detail explained in the above.

Cash flow and future projections (usually 10 years)
Patrimonial State and future projections (idem)
Investment Plan
Retirement Plan
Risk Plan
Tax Plan
Heritage Plan

But there is a more important than being rich is financial freedom. But what is financial freedom? Financial freedom is to generate passive income greater than our expenses. Passive income is that income generated without you having to work for them personally, revenues from their investments.

People just want to be rich to spend more, do not apply in your life concepts such as savings or investments, and the greater their level of spending more will have to work to maintain that standard of living and less time will have to enjoy your family and things that make them happy.
To achieve financial freedom there are certain steps that must be met, a process that takes time, is not achieved from one day to another.

Steps to achieve financial freedom.
As a first step is important to generate income, assets, which are the revenues gained by the work activity being performed, either a salary for their work or the fees received by a professional.

They are active income because they depend on the person is present to generate them. But not to spend all his working life, several times in activities that do not like, it is essential to manage these revenues properly.

The second step is to generate savings from this income and how to achieve these savings are living below their means. This is perhaps the most difficult part of the process. Do not spend all that enters, leading a frugal life.

How many times has gone from an increase or some extra income and say “I worked hard to get, I deserve a prize.” I do not mean to become cheap, I mean not spending on unnecessary things. Do we know where the money will we go? Make a budget and control spending. Know they spend and what expenses can be avoided.

I give a suggestion that could generate savings in a systematic way. When their pay earlier this month, separated by 10% of their income and do not touch it at all, that is to generate savings.
Most people expect to month and if you have enough left over save. Change your way of acting, pay yourself first and then the rest of the accounts. You will see how this simple change its capital going to grow. But is it possible to be financially free just by way of traditional savings? The answer is no. Except in exceptional cases is difficult to generate a saving capacity that allows us to reach a capital such that then automantenga.

Thus the third step is to make investments that will ensure passive income greater than our expenses and then we will already have financial freedom.

This stage is not easy and now with the uncertainty that is experiencing the world. It is therefore important to be well educated in finance or talk to people who know how to listen to investment advice.

The process that leads to financial freedom is not short or easy, but worth it. Manage your income so you can generate savings, whether it saves a lot or little, the important thing is the habit.

Go put together a capital and then invest wisely.
You will see your financial situation begins to improve and need not be a slave to his work.
Make money work for you and not you work for money. To order, discipline and perseverance anyone can achieve financial freedom.

People who think money is the root of all evil, he must be thinking of the love of money and greed.

Therefore we must be sure to make money honestly is a desire to honor and has nothing wrong with thinking about how to engage in money.

Positive Mental Attitude

The first thing we do is convince us that if we can be rich, have the ability to be richer and even more happy that we will be people who think to make money and not have to work on schedule and exhausting to be rich.

To think how rich we have to think they did to preserve wealth and they do not to spend, I know people who live in giant houses and have 2 late model luxury cars and a Suburban for the weekend, anyone who sees them thinks they are rich, but when you have some information he realizes that the house is rented and the cars still are. These cases are very common in the U.S. and that all people are creditworthy, banks here are only provided to show that they do not need money or have a job with a salary out of the ordinary, and sometimes denied credits.

When we think of something we can do to make money see something others do not see and we develop mentally without any barrier and when I mentioned it to our loved ones, the first thing you do is tell us what we’re thinking of not going to work or it is so difficult that we will not be able to achieve even their own mothers out sometimes with the comment “Ah sonny, if such a good idea because it had occurred to another rather than you.”

Then we have to convince us that we can become financially independent with a little effort and a lot of focus.

Money is not more than a meter
Everyone thinks money is the most important thing in the world, some say that money is the root of all evil, but no. The root of all evil, from my point of view, is the lack of money and the love of money. They say money can not buy happiness, but lack of money does not have that grace.

The money is almost nonexistent as people imagine, when money was not started more than a promissory note of the gold or silver was deposited in the bank, now not even worth it, just a role that supports the government of our country and people accepted in good faith as payment for goods or services.

Charity

To receive, you must first give.

It’s amazing the blessings of God that one receives when helping of heart, but I have no explanation for this phenomenon Financial, I can confirm it’s true faith.

All organizations receiving Community Service helps people with big hearts and thank God, with good financial statements.

The rich do not want to help though.

Today we are in a time where the crisis is deepening and rapidly acquires dimensions of recession. The markets remain extremely volatile, fear takes over much of the ruling class and everyone is asking “are we heading for a recession as the 30?”. To that question, the answer that I share with many economists in the world is optimistic: “I do not think so.”

Yet others argue that “we are facing a phenomenon of immense proportions higher than the years 20-30 and the reactions we’re seeing are typical of a bunch of irresponsible leaders, incoherent and irrational, and are designed to cover only measures loss of the great players of the casino economy and a scope and costs absolutely suicidal. ” Those who take the position skeptical or pessimistic answer to those who have tried to calm the world with a “everything is under control,” saying that they hide the huge unpaid debt of Lehman Brothers, a billion in failed credit cards in the assets of JP Morgan and Bank of America, the collapse of General Motors and the automobile industry generally, the near bankruptcy of American local finance, the dilapidated state of the Silicon Valley and the financial difficulties of the giant General Electric … “The with this pessimistic position portend a catastrophe that will paralyze the activity and production worldwide. To them we must remember what Hitler said: “When goods can not cross borders will the troops.”

I have also refreshed the course on “Productivity and Economic Growth”, organized by the Savings Banks Foundation and directed by D. Victorio Valle, held in Manchester in September last year. Specifically, a presentation on the new funding entities ” on line and the alleged risks that could run the small investor. To a specific question from a participant, the speaker replied that, when in doubt, invest only economic quantity, some bad, we can return the Guarantee Fund the administration has for these purposes. Finally, I had in mind some of the recent financial fiascos important to investors and consumers that came to light (Gescartera, Opening, etc.)..

Donald D. Rugg (recognized expert on mutual funds and other financial products), we already said in 1986 that there are nine main reasons why investors, especially small ones, often make unwise decisions: 1. fail to develop a successful strategy 2. excessive or insufficient risk-taking 3. make a poor selection of investments; 4. do not choose the right moment to act 5. diversification of their investment is not adequate, 6. pay high transaction costs; 7. have bad advisers; 8. fail to control their emotions, especially greed and fear, 9. pay too much tax.

Almost twenty-five years later, most of these reasons are still cutting edge. The typical small investor has no knowledge, time or the desire necessary to avoid falling into such errors. My aunt, my brother, my mother, my brother-etc. have some money, and believes the story of the multiplication of the loaves and fishes and revenue easily have told (or emotionally blackmailed my seniors). I, the apprentice smarty financial (or an economist, or administrative or middle management, commercial, etc..) In my social sphere of action administering or advising collaterally, without liability and without preparation (or hard-sided) , huge capital, it can be one of many ways to start the story pyramid. And here we have this huge bag allegedly swindled more than 400,000 “? So many stamps there?, “Guarantee Fund covers this situation? The story can be repeated once more (and in this case would Gescartera multiplied by ten). Finance also has its dark cycles on your face how right he was Manuel!

9 – The magic long ago, start as soon as possible:

Many know that I am quite young, but it is important to learn to start soon. Investing does not take long depending on the degree of investment and can be a great help as we study and work.

Even as a young man starting to save some money you can save interesting to begin investing, much better than starting late.

10 – Be humble and know your limits:

It’s easy to get bigger when the market is rising. But the true risk tolerance only know when you have experienced the ravages of a bear market. Decisive action can be useful at work, but when investing is better to be humble.

In closing I would like to add a rule or Tip number 11 which I think extremely valuable and that every investor should as your money grows.

11 – Learn to return or pass on what we have:

The money is created and achieved by the company like it or not. It never hurts to take into account in our investment plan to help the needy. Therefore it is important to learn that as we get money from the company is always good to return a part, either in actions or assistance.

Also good as an investor learn that it is part of life create value in society and in people. Providing jobs to unemployed, generating new businesses, revitalizing the industry and market and a number of options but does not realize, reversing being generated.

Finally learn how to convey what he learned, his family, friends and strangers who are. This blog is in part that, to pass on what I know and learn. I do not need saving, I do not care to be higher than another, just to be comfortable, to give my loved ones a peaceful life, have time to enjoy and not having financial problems tomorrow. Under this mentality is that it costs so little to teach others what you know.

And how they always say “if a man is hungry do not give a fish, teach him to fish.”

Credit to: Mariano Cabrera Lanfranconi

4 – Learn to buy with your head:

We have many incentives to buy compulsively. Probably heard about the United States population is in debt for life. They live in a consumer society far stronger than us, do not fall into the same pit.

To do so, before making a purchase really think, evaluate the situation. I know many people who compulsively spends saturated even your credit cards, many of these people earn up to 6 times my salary and I was amazed to see how indebted they are. They are the kind of person that even if you earn $ 5000 per month, believe that because the cards give an upper limit on his salary each, have the cash.

5 – Learn to save is as important as saving:

This part is interesting. You make the decision and is willing to save in a sustainable and lasting. But the problem is how to save.

In the case of Argentina had a 10% annual inflation in recent years. This means that if you do not get to work (invest) my savings, I will lose 10% of my purchasing power for years. Here is a great example, you have saved $ 10,000 more each year that money “numerically” is the same, but lost “value.” Stand still and see how they consume their savings without even touching them. To save and better off spending the money on other things.

But if you really smart and invest that money instead of losing value is multiplied. Or take time to learn how to invest or hire a consultant to help you do it.

6 – Learn to manage your investments:

Learning to invest you can save several headaches and money. In the Global Investor Magazine propose the following example:

In the course of his adult life has a balance of U $ D 250,000. If you use a financial planner, you are likely to pay a 1% per year, ie, U $ D 2,500. May not seem like much, but with the magic of compound interest is a lot of money. That you could save if you learn to manage their own money.

7 – Have financial alternatives.

Building wealth, while it may be a slow, can at the most appropriate or necessary. At age 25, his career and work as excite. At age 45, the emotions are likely to disappear and will be hoping for a change. If you have money, you have options. If not, it’s very depressing to reach 40 years stuck in a job that no more knowing that lack a long way to exit it.

8 – Keep valuable advisers:

Investment advisors, financial and real estate valued, can help you to make money. But to evaluate you must have some basic knowledge about financial language and thus keep the good advisers.

These people often have a view from inside the market by extending what you yourself can see with the naked eye and that often means money.

Learn from investments and work with the best advisors to help you make money, not spend it.

Credit to: Mariano Cabrera Lanfranconi

In the latest edition of Global Investor magazine came out a little article with 10 things you need to achieve financial independence. These 10 tips are good to remember from time to time and as a guide. While many of the issues discussed in the blog, it is common to forget them.

So then the 10 things you need to know to be financially free:

Tips:

1 – Make more money does not always solve things:

Many believe that the key to solving financial problems is to earn more money. Tired of debt, unpaid bills or financial fear for the future, is believed to earn more money will solve these problems.

The way we handle our money is more important than the amount we earn. Obviously we’re talking about a midpoint, it is true that very low pay brings problems.

Perhaps by way of example I am the perfect case. My salary did not change anything in the last 2 years, except for a small but insignificant increase compared with the expenses he had. Today I am not a billionaire, but my financial situation is much better than when I started to work. Today have a few small savings to reinvest and I hope that starting small, can get more steps up road to financial freedom.

2 – The three most important keys: Savings, savings and savings:

The key to financial success is obviously spend less than you earn. Usually we see new products that encourage us to buy a new car, a television, a stereo, but the idea is right at the first save, then invest and later give us a taste.

We are constantly tempted to buy new things, advertising, social status, self-image, but we do not realize many times that being patient and being smart can we improve our financial situation.

So the key is to save and not leaving the money under the mattress to try to multiply.

Take an example: You want to buy a TV of $ 1000. I say you invest that $ 1000 in a business that will leave you in a month $ 3000. Trust me, earn $ 3000, wait a month and buy your TV, then this will be $ 2000 to do what you want.

3 – Not all that glitters is gold

Do not be fooled by what we see in others. Our neighbor may have a Ferrari, a beautiful mansion, being a member of the club’s most expensive country, but being in debt and suffering all night thinking about how you will pay all fees.

Comumente have the impression that the rich person is full of luxuries, this is true, but many others are also full of luxuries and debt. Be yourself, not trying to show a picture of what is not, in the long run may end up in debt and be as silly millionaire who lost everything.

The luxuries and pleasures come with time, but meanwhile dedicate yourself to learn to improve their “skills” investor, so it will never be a millionaire idiot will lose everything.

* A sound business concept. The most common mistake that entrepreneurs make is not picking the right business to start. The best way to learn about your prospective business is to work for someone else in that business before beginning your own. Can be a huge difference between a good business concept and reality.
* Understand your market. A good way to check that the market is known as a test market your product or service before you begin. Think you have a great kite that will capture the imagination of kite fliers in the world? Then, make some of them and try to sell them first hand.

* Industry strong, growing and stable. Remember that some of the greatest inventions of all time, like airplanes and automobiles, not result in economic benefit to many who tried to exploit these great advances. For example, the cumulative earnings of all airlines since Wilber Wright flew that first plane are less than zero (the losses of the airlines have been greater than their profits.) Success comes to those who find businesses with great economics and not necessarily great inventions or advances to mankind.
* Administration capable. Find people you like and admire, have good ethical values, skills and are smarter than you. Plan to hire people who have the skills that you lack. Define your unique ability and seek out others who turn your weaknesses into strengths.
* Adequate financial control. Learn later the importance of training in accounting, computer software and cash flow management. Most employers do not have accounting backgrounds and must go back to school to acquire such knowledge. You bet your savings in a game where you do not know how to keep score? People mistakenly do it in business.
* A consistent business focus. If you think of specific products or services, find that specialists will outperform non-specialists. Focus on something you can do as well as being immune to compete with someone with a lower price.