10 Strong personal finance rules make strong financial condition by these simple steps.

  

Top Ten Personal Finance Rules.

10 Strong personal finance rules make strong financial

conditions by these simple steps.

Personal Finance forms the backbone for all success stories.To save you from the hustle and bustle

of having to learn from your mistakes, our team of experts have compiled a list of ten most important

rules that everyone should abide by to be ahead of the game with their finances. Grab a pen and paper

, here are ten of the most important personal finance rules you will never learn in school.Let’s begin. 

01) Save Save Save.

  Save Save Save. In school, they will teach you to save at least 10% of your income.But, let’s be

honest

here, this isn’t enough to retire on.Well, unless you are earning millions.For most of us with a regular

paycheck, a decent savings percentage will be about 25- 40%.

We’re not saying 10% is entirely useless, it could be a great starting pint to build that savings muscle.

In order to save more, reduce your expenses and unnecessary costs. Instead of buying that cup of

coffee every morning, put that money in a savings account with a better interest rate.

02) Emergency Fund 

You may have never heard of an emergency fund from school.But, you’re lucky you have us to teach

you about it. Recent statistics show that up to 40% of Americans don’t have the funds to cover an

emergency of $400.This is an alarming statistic that only shows how people disregard the importance

of an emergency fund.

What if you lost your job today?Would you have enough money to cover your costs?The golden rule

is to have six months of expenses saved up somewhere, but, we suggest that if you can make it more,

the better.

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03) Budgeting Basics

 Budgeting is quite important in life, yet you won’t hear anything about .Sadly, not understanding the

basics of budgeting while in school can leave you disadvantaged right after graduating, especially once

you move out.Not having knowledge of how to manage bills, and create the distinction between wants

and needs can lead to one enduring one hardship after the other.

Everyone needs to know how to plan a lifestyle that is financed by earned income.This includes

understanding how to plan for all bills but still ensuring there’s enough left for necessities such as

groceries and savings.But, let’s face it as much as budgeting is important, no one really likes tracking

every single penny they use.

What you can do instead is what we refer to as tactical budgeting.This involves creating budgets and

plans over a long period of time.For example, you can identify what you need every month and create

a budget with the needs,wants and respective costs over the next six months.From the plan created

you can then separate the amounts into different accounts to ensure you don’t spend beyond your

budget.Then occasionally you can refer to your list to stay on track.

04)Compound-Interest

 The power of compound interest is possibly the best-kept secret.The one thing every young person

has as an advantage over everyone else is time.While they may not achieve their financial goals

instantly, they have an upper hand when it comes to investing. All they need to do is tap into the powers

of compound interest.By setting aside small chunks of money in a high-interest account, young people

can amass great wealth that will compound over and over again through the years.To show you just

how

important compound interest is here’s a great example.

Ex: If someone gave you two options the first choice a three thousand dollars and the second a penny

that doubles up in value every other day.Most people would choose the first choice, right?You probably

did too...But if you do the math,

 the second choice would be worth $10 million after 30 days only!If that’s not enough to convince you to

start taking advantage of this incredible opportunity to grow your wealth, then I don’t know what will.

5) Secrets of Credit

 Here are some Secrets of Credit. Most young people right after getting their first credit cards, end up

maxing them out.They then end up with a life full of debt, where they are forced to pay up huge chunks

of interest rates, and in some cases, this results in late payments that could adversely affect them.

* What most people don’t know is the importance of credit scores and maintaining a great credit history.

But they would probably be aware of the secrets in schools paid more attention to training them on this

life skill.Here’s what you need to know; Your credit score is one of the most important parts of your

financial health, and it generally determines your financial position as an adult.With a proper score,

it’s a lot easier to purchase a house, get a car, get a business loan and makes it much easier to

achieve other milestones in the future.We can no longer ignore the importance of credit.Everyone

needs to know how to build credit and have a proper score all the time.

Here are a few pointers on how to achieve this.One, get a credit card.Most people think getting a credit

card is a mistake but it is actually quite important in building your credit score.Let me give you a good

example, so I have a friend called Kevin, just like some people he avoided getting a credit card for most

of his young years after graduating from school.Doesn’t sound like a big problem, right?But when he

started looking for a home to buy and a car, he couldn’t get any loan approved because his credit

statement hadn’t been established.

Here’s how it works, when you get a credit card and use it, financial institutions recordall your

transactions and interest payments.Based on your efficiency, they will assign a score to your name.

Now When you go looking for a loan, that score will determine the loan amount you can receive and the

interest rate.Two, always pay your debt in time.There’s no other way around this. If money is due today,

make sure you pay it today!

06) Buying Your First Home

 You have probably heard of the popular statement,‘If you want to buy a home you have to save up to

20% of the value for down payment.’If you don’t you will be forced to pay private mortgage insurance,

which could really dent your account.What you won’t learn in school is that while higher mortgage

payments may be painful, the financial trade-off between paying more money now and waiting to save

up the 20% deposit could be worthwhile.

When we look at macroeconomic factors in the US over the past decade, the appreciation rate of real

estate has really gone up but the wage levels have remained stagnant.So it makes it unrealistic to start

saving up 20% of the home value as it will only increase drastically over the years.

The rule behind this is; if you have the capacity to save the money within at least five years comfortably,

then go for it.But, if it will take you longer, you’ll be chasing a moving target as the prices increase.

07) Rules of Insurance

 If there’s anyone who is depending on you financially then you need to get life insurance.This could be

your child, spouse or parent.It is better to get a term policy rather than a life one as you get coverage

whenever the need arises.However, if no one depends on you financially end the policy to save on

money.In addition to life insurance, get insurance for other aspects and assets you own.This includes

your car, home, expensive assets, and health.

You can also get umbrella insurance which covers different policies and guarantees a discount if

obtained from one insurer.Take your time to get different rates and the features available before

choosing a company to insure with.

08) Taxes

 Taxes are such a broad topic that is hardly ever discussed in school.It is important to understand

how they work if you want to be on the right side of the law.Before you get your first paycheck or make

any sales from your business, learn how to calculate the tax rate and find out how much money you

will be left with.This will help you to determine whether a job offer will meet your financial needs and

what the appropriate pricing strategy for your products or services will be.Luckily, there are plenty of

online calculators that will do the dirty work for you.They will show you the gross pay, the amount

payable in tax and the amount left in your account, also known as the take-home pay.

For example a salary of $35,000 a year in Manhattan, New York will leave you with about$26,399 after

tax deductions.Also pay attention to the marginal tax rate that affects your raise.For example a raise of

$35,000 to $41,000 a year won’t give you an extra $500 a month but $345.Make a habit of preparing

your tax returns yourself, there is a lot of misinformation and bad advice out there.Be careful!

09) Guard Your Health 

A hospital visit for an injury like a fractured knee can cost thousands of dollars without insurance.If

you’re finding it hard to meet your monthly health premiums then what will happen if you end up in the

emergency room?You may end up having to borrow money to pay for your medical bills burdening

other people who had plans with their money. Doesn’t sound fair right?If you don’t have a medical

cover get one ASAP!Also, taking care of your health can end up saving you a lot of money.

This involves eating the right foods, maintaining a healthy weight, regularly exercising, not consuming

alcohol and other addictive excessively.You don’t want to be sorry, so guard your health today!

10) College Debt

 isn’t 100% Necessary Contrary to what everyone believes that student loans go hand in hand with a

college degree,you actually don’t need to get one to achieve the latter.85% of new graduates complain

of the heavy school debts and the chunk of money that goes to paying it off immediately they start

working.It’s not always a must you get these loans to pursue your degree.Some institutions like the

Davidson College in Charlotte help students so they don’t end up in debts.Other schools offer great

education at a fraction of the private schools tuition fee.You could also attend school part time, work

as you study, enroll in a more affordable school, graduate fast, or begin your journey in a community

college.But, we’re not saying debt-free schooling should be everyone’s goal.In some cases it might be

worth it.If you’re set to launch in a very high-paying career path, then a few thousands of dollars

shouldn’t get in the way.However, don’t establish this debt as the main factor of existing as a college

student.There are so many other ways of achieving your career goals.

That’s it for today, Thankyou, And IF you having any queries so just ask in comment box now,