Mantras of Personal Finance
1. Compounding
3. Monthly journal (errrr.....) and digital wallet!
2. Diversification
- Called the 8th wonder of the world by Einstein
- The longer you invest, the larger your return.
- Start with investing a small amount (ex: 1000 bucks)
- You receive an interest amount ‘x’ , add this to the 1000 bucks. .
- After some time you get interest on the new invested amount (1000+ x)
- On repetition of this process, you increase your initial amount exponentially, which is called compounding.
2. Diversification
3. Monthly journal (errrr.....) and digital wallet!
2. Diversification
- “Don’t put all your eggs in one basket.”; this simple mantra explains how having different kinds of assets will always be more beneficial than having very few assets of similar types.
- If we diversify our assets, certain risks are lesser and the chances of return are higher.
3. Monthly journal (errrr.....) and digital wallet!
3. Monthly journal (errrr.....) and digital wallet!
3. Monthly journal (errrr.....) and digital wallet!
- To get a good grip over your finances,keep a journal. Record all your transactions in the journal to keep track of your financial standing. Mehh... who has the time?
- Well, this can be easily done through a DIGITAL payment platform like Paytm, Google Pay etc.
- Just ensure you get all your income through the digital route and also try and make all your payments through this.
- Paytm and Google Pay are common platforms, and are generally available on all the digital sites, so choose any one and you can get a good overview on various expenses.
4. Investing Early:
6. Be Smart about offers
3. Monthly journal (errrr.....) and digital wallet!
- Investing early is one of the golden rules of investment.
- The earlier one gets into the investing world, the better! Early investments(however small) help us understand the fundamentals and finer aspects faster.
- However, the primary advantage is that investing early will ensure that our money will get more compounded and thus will have a higher return.
- More time, more profit ! :)
5. Needs vs Wants:
6. Be Smart about offers
6. Be Smart about offers
- We learn to value money only when we start earning it ourselves! We must know how to optimize expenditures by using discounts and offers.
- At the same time, learn to curb impulsive expenses. Do you really need those boots? Or do you just want them?
6. Be Smart about offers
6. Be Smart about offers
6. Be Smart about offers
- Did you know 85% of the free discount coupons available online are left unused?
- Explore the multiple coupons and offers that each brand or company avails to its customers on their official site/ app and discover even more on sites like coupondunia.com, etc.
7. Budgeting
8. Identify short term and long term objectives
8. Identify short term and long term objectives
- Budgeting is an art: the art of allocating your money among different uses in order to limit expenses.
- A good way to go about is to fix a ratio between savings and expenditure.
- This is a bit theoretical, but even a broad plan would be good to start with!!
8. Identify short term and long term objectives
8. Identify short term and long term objectives
8. Identify short term and long term objectives
- Objectives are the goals that you aim to accomplish.
- For example you may aim to earn a certain amount of money to buy a book and rent a house.
- The book can be bought immediately which makes its purchase a short term objective.
- Renting a house requires you to earn more which makes it a long term objective.