11 Personal Finance Tips and Tricks

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Most people know to develop a budget, save, and avoid running up debt. These are the fundamentals of good personal finance. Every finance guru preaches these three concepts.

But even knowing these basic principles can be confusing when incorporating them into your life. Here are 11 personal finance tips that are easy to put into practice.

Track Net Worth

Your net worth is your assets minus your liabilities. Your assets encompass everything you own. This could be equity in your residence, stocks, commercial real estate, etc. Your liabilities are everything you owe, like credit card debt, car payments, mortgages, etc.

You’re doing fine if your assets are worth more than your liabilities. If not, then you need to make an effort to pay off debt to bring it into balance.

Tracking net worth provides a big picture number that lets you know where you stand financially. Checking it periodically will alert you if you’re starting to backslide.

Cash Is King

The mantra is to invest for retirement. But your financial house needs a strong foundation, which only comes when you have an emergency fund.

An emergency fund isn’t as glamorous sounding as investing in stocks, but it will save you if there’s a job loss or expensive car repair.

If you don’t have an emergency fund, you'll be dipping into your investments, thereby losing more money in the long run.

Cash in the bank will keep your financial plan from unraveling if something unplanned happens.

Level Up Network

Look around at the people you hang out with. Are they always going out to dinner and spending what they have? Do they complain that they’re always in debt?

You don’t need to abandon them as friends, but do expose yourself to like-minded people when it comes to finance. Through conversations and sharing their lifestyle, you'll level up your network. It gives you the opportunity to learn by watching and learning.

Investing Should Be Boring

Good investing is like watching paint dry. It shouldn’t be fast-paced and exhilarating. If you want that, Las Vegas might be the place for you.

Go with logic, not emotion, when investing. You'll want to buy low, but consider sitting on it for years. You don’t want to reevaluate it daily. The goal is steady growth.

Good investing takes patience and zero emotion.

Invest for the Long Run

Famed investor Warren Buffet said it best: “Our favorite holding period is forever.” In other words, don’t focus on the short term, look to the long term.

And Buffet practices what he preaches. His Berkshire Hathaway has held stocks in some corporations for decades. For example, shares in Coca-Cola have been held for 34 years, and have held shares in Costco for 22 years.

Compare that to the average investor who holds shares on average for five months. The average investor is hoping for the market timing. But it’s often a fool’s errand. It’s probably best to adopt Buffet’s strategy and go for the longhaul.

Marry With Money in Mind

Marrying with money in mind doesn’t mean marry for money. It means being on the same page with your spouse regarding finances. A household shouldn’t be divided because of finances. There should be mutual goals.

Make it a point to have a monthly meeting to discuss budgeting, debt, opportunities, etc. Staying open about finances keeps both of you on track. And it may help in maintaining openness in other ways.

Don’t Buy to Impress

Keeping up with the Joneses only keeps you in the poor house. Do you really need that luxury car, or is it just to impress your neighbor?

Most people who spend to impress regret it the moment the credit card bill hits their inbox. And, frankly, most people really don’t care what car you drive or how big your house is. It’s all in your head.

Spend Only When It’s Important

This might seem like an odd finance tip. After all, telling you to spend sounds counterintuitive. But spending on what you love rather than what you like can save you money in the long run.

If you love buying old books but don’t care about clothes, then buy your jeans at Walmart and save for what you truly love.

Don’t buy anything you don’t love just because it’s on sale.

Unsubscribe From Promotional Emails

Have you ever received a promotion in your email and thought, that looks like a good deal? It wasn’t something you were thinking about purchasing, but it’s tempting and right in front of you.

Promotional emails can create the impulse to spend. It’s best just to eliminate them by unsubscribing from the retailer.

Remove Online Auto-Saved Credit Cards

Never save your credit card information online. Even if it’s your favorite online retailer, you don’t want to save it.

This will protect you to a certain degree from mindless spending. If the card is there and you don’t have to go fishing for it, you’re more apt to push that “buy” button.

By not buying, you save and don’t run up more debt.

Track Spending for a Month

Track your spending the old-fashioned way. Take a pen and notebook and write down everything you spend money on during a month. Even if it’s a cup of coffee, write it down.

Everyone talks about the evil of credit cards, but a debit card can be just as dangerous. Knowing where your money is going will help you save.

And writing down where every dime goes will make you conscious of your spending. You'll be able to make better financial decisions.

Personal Finance Lifestyle

Good personal finance goes beyond making a budget or investing in the market. It’s about changing your lifestyle. By making good choices, you can clear the path to your financial goals.

The Epoch Times Copyright © 2023. The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.