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Personal Finance Tips - Five Simple Rules For Money Management

By Edited May 7, 2015 0 4

Rules Of Money Management

Personal Finance Tips - Five Simple Rules For Money Management

Why 5 Simple Rules For Money Management?

Everyone needs simple and clear rules to follow when it comes to money management. In today's economic environment, money management is more important than ever.

With more and more people losing their jobs and the sky rocketing prices of gas and food, managing money the right way is the difference between having money and going bankrupt.

How To Use These Simple Rules

Ever since I started learning about finance, the one thing that has stayed constant is the search for more knowledge.

Continuing to learn is the cornerstone to good money management as well as staying apprised of the national and international invents.

Make sure that you study these rules and learn as much as you can about them. Don't ever stop learning.

Here Are 5 Simple Rules For Money Management

  1. Rule: Use A Financial Statement - This is one of the most important day-to-day activities that anyone can engage in when it comes to money management. Building a financial statement will allow you to constantly watch your income and expenses so you can make adjustments as needed. This will also force you to record and keep track of all of your expenditures.
  2. Rule: Use A Balance Sheet - A balance sheet is a document that shows assets and liabilities and the health of those compared to each other. This is extremely important because increasing your wealth by obtaining assets is measured in order for you to know if you are ahead or behind.
  3. Rule: Use A Financial Adviser - Finding the right financial adviser for you is a lot harder than you think but a lot more worth it than I could ever convey. They can help you plan and see things that you cannot. It is their job to learn and follow what is working 8 hours a day. Most of us work all day and come home only to want to go to sleep. Figuring out what investment is going to make you the most money is not on your top priority list.
  4. Rule: Use An Insurance Agent - If nothing else, an insurance agent who can get you squared away with life insurance, car, home, etc. is the most important thing to start with than the all the rest. You never can have enough insurance. I know that most people don't want to think about bad things happening so they don't get insurance but that is not how to manage your money effectively. 
  5. Rule: Use A Bookkeeper - A lot of people will disagree with me but that is why a lot of people are in trouble financially. Bookkeepers are cheap and can do so much to help you keep everything nice and neat and they can even give you advice on how to better your financial situation.

These rules are not in ant specific order but I would suggest the first thing you do is get life insurance. It is such a critical part to your overall financial health.

No one wants to leave their spouse and family after an unexpected death with no way to pay the bills.

Also, learn as much as possible about financial statements and balance sheets. I will posting more as I go.






Apr 5, 2011 8:04pm
I endorse your tips. Personally, I would add a sixth rule: pick up a few good books on personal finance and investing at a second hand store or on Amazon. It's easier than most people think to give themselves a crash course in the basics.
Apr 5, 2011 8:33pm
Absolutely. I think that reading is the best way to learn more about these things. Thanks for the comment.
Apr 5, 2011 9:15pm
Great advice!
Apr 5, 2011 9:17pm
Thanks James. Hope this helps.
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