Many people have spend their life as a student for almost 20 years to study. As a student, you are requested to study millions of pages but no institution, university teaches you how to earn money in order to become rich. You may be genius in study and score good marks but you cannot earn money unless you have financial intelligence.

Financial intelligent means managing your own money in such a way that you become richer as the month passes. That means to manage your own cash flow in such a way that cash inflow should be more than your cash outflow during month end.

Getting richer every month is possible through the investment of your own money. Put your money to work in the stock market as your slave. The market will helps your money to grow. If you just keep your money in the locker then your money will not grow. The inflation will reduce the value of your locked money without you even realising it. So invest your money to avoid inflation effect and earn more money from your investment.

People usually invest with the intention to generate higher return than their investment. The bank Certificate of Deposit is usually that kind place. But bank CD only provides safety (having doubts after the recent bank crisis). In order to become rich you have to invest your money in some other option of investment. However, this is true that the investment is not free of risk and the return always will not be as higher as required. 

On the other hand if you can manage your investment money and risk you can maximize your return with the power of compounding.

This is not a call for you to start gambling but it tells you to build your portfolio in such a way that your risk can be minimized and get optimum return. Now the question is where the investment should be done. For this you should know the investment option available in the market.

One can invest in equity shares. One can invest in mutual fund, debt related funds. Bank fixed deposit, company fixed deposit.

In Equity market you should purchase shares. This is because the equity shares make you a proportionate owner of the company. Here also you can lend your money to the companies like a owner. If companies make profit then you gain interest and if the companies make loss you also loose money. The debt market provides you lower return with safety. The equity market is risky and there is uncertainty in return but if the market is operating well then you will get healthy return.

So, you must learn and have control over your investment cash to ensure positive return. In short, your every step should be backed by a strategy and proper financial planning.

Relevant Reading:
Be Smart, Act Fast, Get Rich: Your Game Plan for Getting It Right in the Stock Market : Charles V. Payne

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