Personal Finance Tips For Beginners – 15 Powerful Practical Guide

Many people struggle with personal finance due to a lack of awareness regarding personal finance. In this article, we are going to cover the 15 best practical guides towards personal finance tips for any new beginner who is planning to manage their personal finance easily and simply.

15. Invest In Yourself

Invest in yourself this is an all-time favorite line of Warren Buffett.

The best investment you can make is in yourself

– Warren Buffett

Before investing in stocks, bonds, FD, or anything you should invest in yourself. Because that return will be uncountable and that interest will be lifelong.

Investment in yourself means investing in your mindset, investment in your skills, investment in your personality development, investment in communication skills, investment in your soft skill or hard skills. Trust me guys this investment will pay you lifelong and you don’t have to worry about that.

14. Invest as soon as possible

Starting early in any field or in anything is always an extra advantage. Investing as soon as possible is much more important concerning money and investing. Whether it is the stock market or bonds or any other investment segment you invest in.

Because compounding plays a very important role in investing that’s why the word compounding can make a huge and huge impact. Every minute counts in compounding and that can create magic for you.

13. Invest first then save

I had heard very wrong misconceptions about this; almost every house does this. So First invest and then try to save money. By saving you just save your money you can’t grow that money if you want to multiply your income or asset then you have to invest first and then save.

By saving you can save that particular amount of money only but by investing you can grow to the next level with the proper planning.

12. One income source is not enough

One income source is not enough you know it very well. Relying on one particular source of income stream and in that case your income stops anyhow then you will have to suffer. For that, you need to have at least 2 to 3 sources of income or at least two income sources so that you can not get disturbed when your first income stream stops for any reason. You still can survive easily.

11. Budgeting

Having a budget is a plus point in saving and investing because if you have a budget if you have proper budget planning that will allow you to save extra income. So that you can invest that money.

Also, budgeting becomes very important because when you have a budget you avoid purchasing extra or unwanted kinds of stuff that you don’t need at that time.

10. Saving is also important

Many people do this wrong as soon as they get their payment they start making expenditures paying off the bills etc and after that, they will try to save money out of that remaining one but most of the time the saving is not even left. I have a Formula so that you can get an idea of how to save your money.

Income – Expense = Saving ×

Income – Saving = Expense ✓

First, save your money from your income and that remaining one you will use to do your expenditure I know, it might get hard initially but later on, as you get to that you will be used to that.

9. Stop buying unwanted things

If you don’t want things don’t buy them and don’t store them in your home. It is not compulsory to spend every piece of money you have on yourself. Sometimes you can save that extra money for emergencies too. One of the famous quotes on this by Warren Buffet is that

If you buy things you do not need you will have to sell things you need

– Warren Buffett

8. Live a debt free live

A debt-free life is very important for a peaceful and healthy lifestyle. But due to a lack of knowledge regarding debt management, many people fall into the trap of debt. You can think that debt pressure is so much on many, if they can’t get out of it they attempt to suicide. Yeah, this is the harsh truth.

But this is not the right way to deal with debt. This can’t conclude that debt is bad. We will discuss this topic separately. One should understand improper use of anything is harmful to money as well as health.

7. Insurance

Some Insurance is very important for everybody. Read it again I had said some Insurance is very important not every insurance is important. So, in this case, you have to have proper learning and knowledge about your insurance. So that you can come to the point which insurance suits you better depending on your needs and desires.

6. An emergency fund is very important

In the pandemic, you all will agree with this point emergency fund is very important. I am sure you too have realized that. Don’t you? At least for the safer side, it is recommended that a 6-12 month emergency fund is a must. Depending on your needs.

For example, 3000$ is your monthly income in that case 3000*6 = 18000$ (considering 6 months emergency fund) will be your emergency fund. Note: you will not think of this amount for your need, wants, or desire this is only for emergencies. I hope you know what is an emergency.😅

5. Use of credit cards in a right way

Most of you take credit card for granted. But mark my words the day credit card will take you for granted then be prepared for that. I know you all are smart audiences you won’t do that. Pay off the bills of credit cards on time so that you are on the safer side with that giant interest rate penalty.

4. Track your income

Keep an eye on your income. Because I strongly believe that “if you can’t track it you can’t manage it too”. So do track your income so that it will be easy to manage it.

3. Review your finance from time to time

Why reviewing your finance from time to time is very important because as you review your finance you will get to know exactly what things are necessary or not. So that you can get prepared for the next time.

2. Learn more about personal finance

The day you start understanding personal finance from that day onwards you will start enjoying and loving that finance. I am pretty sure about what I said because if we understand something or someone we start loving that thing 😄.

• Read Personal Finance Books
• Watch YouTube Videos on personal finance
• Read more articles on personal finance ( Like us ) 😂

1. Reward yourself

Reward yourself by doing a small party with a small percentage of your income as you progress your finance journey. Because finance will be lifelong.

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