Money rules might be simple, but they’re not always easy to stick to. Just as your physical well-being, your financial well-being is necessary in ensuring your balanced financial life, it goes a long way in placing a balance between your income, expenditure, savings and investments. If you want to build wealth, you have to constantly work on your money habits and rethink your relationship with money. Here are some of the best personal finance tips from Life Hacker that everyone should learn or relearn.
There’s No One-Size-Fits-All Approach
Personal finance is, well, personal. Sometimes rules of thumb given as advice are really unhelpful, like telling someone to just “spend less than you earn.” When you’re broke, for example, you might need to ignore lots of financial advice that would be bad for your situation. And even people who earn the same amount of money will have different budgeting strategies and financial goals. So listen to money advice, but adjust it for your situation as needed.
Some Money Rules Never Go Out of Style
That said, there are some personal finance basics that everyone would benefit from learning, especially when this isn’t a topic that’s taught in schools. The most important personal finance rules don’t change—including the most basic truth that you need to have a gap between your income and your spending, whether you’re spending less than you earn or earning more than you spend(same thing, but subtle difference in perspective).
Money Can Buy Happiness (But It Depends on Where You Spend It)
Money is a means to an end. While it can’t buy you love, it can buy you happiness—if you prioritize your spending on the right purchases, such as experiences and helping out others. When deciding where to spend your cold hard-earned cash, look to those purchases you’ll spend the most time with.
You Need a Budget
A budget helps you figure out where your money should go; without one (or without tracking it), you might find yourself thinking that money is just vanishing from your wallet. Set up your budget and track your spending.
DO NOT Always Keep Your ATM Card In View
When you’re in the habit of always hanging out with your ATM card and resorting to it at any slightest need of money, so will money alongside continually hang out and cat walk of your pocket; and you end up at the long run asking, “where went my money?”
How You Think About Money Is the Biggest Game-Changer
Personal finance might be a numbers game, but how you think about money dictates how well you play it. Have a positive thought pattern towards money.
The Earlier You Start Saving, the Better
This is something we probably all intuitively know, but it’s not until you witness the power of compounding and how time is your most powerful asset when you’re young that you realize, oh, I should’ve started saving yesterday (or last year or last decade). Not making a habit of saving early is the biggest money mistake we make, according to Warren Buffet.
Learning About Money Is an Ongoing Process. Keep Learning from Others
Your financial situation will change—and keep changing. The financial environment will also keep fluctuating. Stay on top of this by being open to new advice and regularly challenging your money assumptions.
Stay open to learning, unlearning and relearning!