5 Personal Finance Rules To Follow To Become Financially Free

Most of us would be interested to know if there are any personal finance rules to follow to attain financial freedom. And the good news is, yes there few rules that can help you manage your finances in a better and organized way. Managing your finance efficiently is a struggle for most of us. But it is very much important to manage your finances properly or else the repercussions can be gruesome. Initially, you might just worry about not having savings but it can also lead to an imbalance in your retirement phase.

Handling finance properly is not a day’s job and it comes with practice. Once you get started with managing your finance in a better way then, you can explore other ways to boost up your savings. As you become a pro, you can create your own personal finance rules to add to the list as well.

We share with you 5 Personal Finance Rules that would help you to handle your finances in a better and efficient way. These personal finance rules are like a guide to show you a path to manage money and as a result get a groove of some dollars in your account. Savings add financial security to your life and give you the confidence to face any financial situation.

5 Personal Finance Rules to follow to get started:

Rule 1. Cut down on unnecessary things and add that money to your savings

The first personal finance rules to follow is starting saving as much as possible and start it now. Every month after you get your paycheck, you will clear off the necessary bills and make essential expenses on housing, food, and utilities. Keep some money for your transportation and other important stuff. Now, analyze what you generally do with the money left. If it is spent on unnecessary things that you can cut down then, think what you can do with the money left.

The best thing to do is put at least 50% of the money left for your savings. This will be a good kick start and it won’t pinch your budget as well. In few months, you’ll realize you’ve built your saving nest already and you just need to boost it up.

Rule 2. Look for investment options

One of the best ways to handle your money is to invest it wisely to get the best returns. For beginners, you might always feel the risk of losing money and unsure of which option to go for. As there are lots of different ways where you can invest and choose based on the risk level such as mutual funds, stocks, peer-to-peer lending etc. For beginners, you can opt for investing in small number and with a low risk through various options. Even a small investment will give good returns in the long run. You can do a research online or check with a reliable financial advisor for more details.

Rule 3. Never encourage credit card debts

Having a credit card debt can be alarming as most of us use a credit card for non-essential purchases, luxuries and impulse purchases. Paying interest for those things and having debt can affect your credit score.

But, wise use of credit cards can be beneficial as well. If you clear your credit card bill on time and use it to the amount that you can repay, then you can have a good credit score.

Rule 4. Get thoughtful about your regular expenses and pay full amount only where it is necessary

You need to keep a track of where all your money goes on a monthly basis and so, start by analyzing your expenses. For the regular purchases, check for coupons or discounts available. Wait for the year-end sale for any major purchase.

Rule 5. It’s your money so make every move meaningful

Set a budget for everything you buy to be it a house, a car or grocery. It is important to know your affordable limit and make every purchase meaningful. Even if you can afford a larger home, a new car etc. you don’t have to buy it when you are already comfortable with the things you have.

Summing up:

By following the 5 above mentioned personal finance rules, you will be able to set yourself in the right direction for a better financial future. It’s okay to slip occasionally from the planned schedule sometimes, but you need to know how you can set it right. You make a small unplanned purchase which refrains you from saving the set amount for the month; don’t worry you can balance it the next month. Handling personal finance efficiently is a learning process and when you start saving more than you spend, then, you will know that you’re on the right path already.

How to Manage Your Personal Finance Like a Business?

People who have spent much time over their workplace can use some relevant skills to manage their personal finance. For those who work at big companies or have their own start-up, or even for the government, will have to involve dealing with some form of financial management.

In this article, you’ll get to identify some of the personal finance management skills that you’ve learned at your workplace and can apply them to your own financial management.

Now, there are simple and absolutely easy targets that will help your lifestyle and improve your finances. Even if there’s no magic formula that would make you completely unstressed about money, however, if you’re being stressed, then you can get a hold on your personal finances by adopting these techniques. In this article, you can find keys to help you get control of your finances and after following them consistently, you can see that your financial problems have diminished to a greater extent along with all the financial stress.

It is quite feasible for anyone to accomplish them regardless of their financial knowledge.

Start with goals

The first thing you should do is write down your specific goals about what are your priorities regarding money and life. Since finances can affect various areas of your life, your goal to a different perspective would surely affect how you plan your finances. Also, your goal to retire early depends on how well you manage your finances now. In case of homeownership, starting a family, changing career, or moving will all be affected by how you handle your personal finances.

Once you list out all your financial goals, you need to prioritize them and ensure that you’re paying attention to each one that holds your most important. You can also write them in the order you want to achieve them, however, give more importance to bigger and long-term goals like saving for retirement while also working for other goals side by side.

Tips to identify your financial goals:

You should start by setting long-term goals such as buying a home, retiring early, getting out of debt as these are separate from your short-term goals. Thereafter you can consider setting short-term goals such as not using credit cards, decreasing your spending, following a budget, etc. However, don’t forget to prioritize your goals by creating a financial plan.

Create a plan

A financial plan is crucial to help you reach your financial goals. These plans cover through multiple steps and through sample plans; you could get control over your budget, get out of debt and create a spending plan.

Once you’ve adept these 3 things, you’ve freed some considerable cash. Now, the money that you’ve freed up from debt-payment can be used to reach your goal. So, you need to decide your important priorities and take a steady effort to work towards your long-term retirement goals, even not neglecting the goals that you have set for yourself.

For example: for your next step, things that can be worked for are like: extravagant trip, buying a home or building your own business, buying a car, etc. These goals, along with the emergency fund will help you stop making a financial decision that drags you towards fear and leads you to have controlled access over money.

Things to consider while creating a financial plan:

Budget holds the key to success and is the tool to provide you with control of your financial future. This is also the key to achieve the rest of you plan and so you need to contribute to long-term goals like saving for retirement without thinking of the status of your financial plan. Apart from this, another key factor is to build an emergency fund that will lead you to financial success.

Some of the crucial things to consider are:

  • Budgeting
  • Diversifying revenue streams
  • Spending on assets
  • Maximizing tax breaks
  • Prioritizing spending
  • Not re-learning, just re-application
  • Stick to your budget
  • Get out of debt

Advice is always helpful

Once you are ready to begin investing and grow your wealth, you should speak to a financial planner who can help you make your investment decision. A good advisor will share the risks involved in each investment and help you find products as per your level of satisfaction. They will also help you work towards your goals at early times. Also, a financial planner will take concern for your budget which is an additional bonus for your long-term success.

As investing is a long-term strategy to build wealth, financial help can be found anywhere nearby your area or even from through online mode.

A community centre or local church will offer you classes on budgeting and personal finances. Even at the time, you can seek the course offers from various credit and banks unions as well.

If your parents or family members are at good with money, you can ask them for help by talking to them about what they have done differently and what worked for them financially.


This article gives you complete simple and absolute targets to improve your finances. If you are having hard times related to your personal finance and have tried looking for numerous options, you can conclude your search by relying on the above mentioned management steps. It will successfully work to give you an insight on how you can take control over financial goals and control them effectively for both long-term and short-terms prospects.

As such you can make the best deals out of each step and look forward for a pleasant yet stress-free solution that will diminish your financial problems.

11 Financial Decisions You’ll Regret Down The Line

No matter what your long-term financial goals are, there are some financial decisions you will come to regret. Fortunately, you can head these decisions off now that you’re reading this.

As you make your daily, monthly, and annual financial decisions, be sure to avoid making these incredibly regrettable choices. In ten years, you’ll thank yourself.

Failing to save enough money

Many people don’t realize the value of putting money in savings until it’s too late. There are several excellent reasons to put as much money into savings as possible.

First, you’ll need money to cover emergencies and other unexpected expenses. If you ever have a job loss or reduction in household income, savings can help supplement the income loss until you’ve replaced it. Savings can be used for a down payment on a home or car, to pay for a child’s college tuition, or even to start a new business.

Buying a house before you’re ready

For years, owning a home has been an essential part of the American Dream. But, rushing to make that dream come true can turn into a nightmare, particularly if you have to take out a mortgage for your dream home.

A mortgage is a major long-term obligation. With homeownership, you’re also responsible for property taxes, insurance, and home maintenance and repairs. Buying a home before you’re ready can derail your financial progress and delay some of your other financial goals. Make sure you’re following sound advice when looking to buy a home, and not acting on impulse.

Not building a good credit score

Credit scores are a numerical representation of the information in your credit report. The three-digit number measures the likelihood that you’ll default on a new credit or loan obligation. Many businesses – creditors, lenders, and other businesses – use credit scores to decide whether or not to approve your application and to set the price they’ll charge when they do approve your application.

Waiting too long to start building your credit means you’ll often have trouble getting approved. When you are approved, you may have to pay a higher interest rate or security deposits. Once you build your credit score, the lender’s requirements will be more lenient.

Waiting too long to start investing

Investing can seem intimidating, but once you understand how investing works, you’ll be upset with yourself for not getting started earlier. When you start investing earlier, your money has more time to grow.

You can build up much more money over a longer period of time by starting earlier rather than waiting for some point in the future. Not only that, when you’re younger and have fewer family and financial obligations, you have much more flexibility in how you spend your money. That is one of the best times to get started investing.

Not getting health insurance

Forgoing health insurance may sound like a good way to minimize your expenses and keep more money for yourself. However, not having health coverage is risky, even if you’re healthy.

You could have an accident or fall ill at any point, without warning. Without health insurance, you’re financially responsible for all your medical bills. If you can’t afford to pay medical bills, it could push you into bankruptcy. Medical debt is one of the biggest causes of bankruptcy in the United States and it often stems from a lack of health coverage.

Even if you get hurt at work, disability will not take care of everything, and often, it’s an incredibly hard process to navigate. Most people need a lawyer to get through the Social Security disability process.

Don’t get caught with your pants down trying skating by without the medical care. Your future self may come to regret it.

Carrying high interest rate debt

If you don’t get rid of your high interest rate debt now, ten years down the road, you’ll look back with much regret over the amount of money you wasted on interest payments. It’s money that you can’t get back, that you could have spent on something far more beneficial.

Focus on getting rid of high interest rate debts now, even if you have to make some sacrifices. The money you save on interest and finances charges will be far more productive being invested or saved.

Not diversifying your investments

The idiom “Don’t put all your eggs in one basket” is perfect to describe why you should diversify your investments. Diversifying means you’re investing your money in different places to hedge against risk.

That way, if one investment drops in value, the money in other investments will keep you from suffering a total loss. Diversifying is about more than putting money in different stocks. You should also invest in other types of securities and accounts.

Not Diversifying Your Career Skills

The workforce is changing. Automation is eating up administrivia, and some people are left jobless. You’re out of your mind if you think what you do with your career is not a financial decision.

Everyone wants to “do what they love,” but very few people love what they do. They do it for money, plain and simple. Apart from the obvious ones, automation software is already taking hold of marketers, project managers, IT professionals, AP clerks, and the list goes on. It’s taking aim at more careers too.

If you want to stay employable, start embracing technology, and getting used to managing it. You should also be familiar with whatever higher-level tasks are available in your career vertical. This will be a huge help down the line.

Living above your means

Spending more money than you make will quickly lead to financial disaster. There are only two ways to fund this lifestyle – either by dipping into savings or by creating additional debt – and they’re both disastrous.

You can ensure you’re living within your means by using a budget to plan your spending. Reduce your expenses so they fit within your income rather than stretching your spending outside of what you can afford.

Loaning money to friends or relatives

Most of us want to help a loved one who’s in a tough spot, but too often, these situations backfire. Loaning money to a friend or relative turns your relationship from personal to business.

If they can’t afford to pay you back, it can put a strain on your relationship and possibly even end it for good. That’s not to suggest you can’t help out, but considering your help a gift rather than a loan can keep your relationship from falling apart.

Not educating yourself on personal finance

It’s your job to learn as much about personal finance as you can so you can work toward a secure financial future. There’s a wealth of free information available on the internet. You can also check out books from the library or purchase books if you prefer to own them.
Investing in your own personal finance education will prove to be invaluable when you look back 10 years from now.