Finance

  Why should you be bothered about nterest rates? "Interest rates are to asset prices what gravity is to the apple. When there are low interest rates, there is a very low gravitational pull on asset prices." - Warren Buffett. Prices of assets, cost of borrowing and rewards for savings are tied to the rise, fall and stability of interest rates. Interest rate for borrowing (cost of borrowing) is the percentage of the loan amount. The higher this percentage is, the more the interest to be paid back in addition to the principal.. At lower interest rates, borrowing to buy big assets is more attractive than borrowing to aave.  At lower savings rate, a percentage of savings paid into a savings account is less than at higher savings rate. So, it makes more sense to borrow to spend and buy assets rather than borrow to save and be rewarded with low interests. At lower interest rates, spenders pay less interest and have more money to increase their spendings on consumer goods. This lead...

  It’s very difficult to achieve financial prosperity without puting the concept of opportunity cost to use in your spending. It’s normal to have many wants competing for your money, which may not be enough to get all of them for you.  So, to get the best out of your spending, you must understand the value attached to the best alternative foregone.  This is opportunity cost.   Understanding ande applying the concept of opportunity of cost to your personal finance, are going to help you achieve the following seven personal financial goals; 1.Spending  Within Budgetary Provision: A good budget should be a financial plan that accommodates absolutely necessary expected spending within expected income.  Obviously, a good budget is not possible in the absence of opportunity cost as you wouldn’t be to put in the budget, only things which enhance personal financial health.   So after the budget has been set up with the help of opportunity cost, ...