How to Build Personal Assets

Want to build personal financial assets without having a lot of money? Anyone can afford to build their assets up by doing some simple financial steps.

How to Build Personal Assets

Step 1

Most of the time when we think about the future and money, especially parents, we think about our child's future. How we're going to pay for college, how to buy their first car or get the braces they needed for their teeth. We need to start building assets to fund these things when they are toddlers. But suppose you don't have any children, even so, you still should have future money concerns. Yes, you might have a savings account, but do you have other assets? Now when most of us think of assets, we think we have to have a serious portfolio. Major stock, property, treasury bills, annuities, IRA's, money market accounts and bonds. It would be nice to have all of those things, but if you can't afford that level of a portfolio, you can build assets to fit your level.

Step 2

Building assets at your level means acquiring what will fit your pocketbook. Being single or married and taking care of your self, a family and a household, you might not be able to afford to invest in all of those things listed above. What you can do is build assets from the money you have. The first thing you needed to do is to make sure you do have a checking and savings account. Those will be your main assets. Check with your bank to see if you can get a line of credit on your checking account for overdraft protection. Set-up two checking accounts: one for household to pay your bills through and the another one for personal use. Have two savings accounts also: one for saving for large purchases that will take time to save for and the other one for quick purchases.

Step 3

Next, buy some government bonds. The most inexpensive bonds to buy are Series EE bonds. They sell at a discount and are redeemed at a higher value. You can buy them from a bank, through payroll deductions or you can go online to buy them at (www.savingsbond.gov ). They cost between $25.00 and $5000.00. The cost of the bond is half of its face value. Interest builds up in the value of the bonds after a period of time. Buy a bond each pay period and you'll do very nicely. A lot of parents buy these bonds for their children, but anyone can buy them to start building up their personal assets without investing a large sum of money.

Step 4

Mutual funds are good to invest in when you are on a budget. Mutual funds are an investment that pools together the money of thousands. You will be buying units, which are called shares. You can have a minimum of $50.00 deducted from your checking account each month to buy into a fund. This is better than taking money if you are on a tight budget to play the stock market. Also, the next time you get a bonus or a refund, buy a $500.00 Certicate of Deposit (CD). Some banks have add-on CDs for six months that will allow you to deposit money into them before they expire. This is a good way to build up extra interest that when you withdraw the money, you will have interest you can roll-over for another six months and keep depositing extra money into the CD to make it grow.

Step 5

Now, lets list your assets. You have two checking accounts, two savings account, a line of credit, series EE savings bonds, a mutual fund and a CD. Not bad, for someone on a budget or without a lot of extra money. The key to building assets is to work with what you have; it does not matter how large or how small the amount you are investing , it's what you invest it in. The main thing is to start investing into something that will fit your budget. If you can't invest into everything stated above, get one checking account and one savings account, buy one EE Saving Bond and take $50.00 and invest in a mutual fund. Starting off small will prepare you for larger investments in the future.

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