Everything You Need to Know About Personal Finance in 1000 Words

by C.J. Carlsen

“live a rich life by spending EXTRAVAGANTLY on the things you love, and cut costs mercilessly on the things you

don’t”. Think about your purchases before you make them. Take at least 60 seconds for smaller purchases, and up to 24 hours for those larger purchases. Consider how you will feel about your purchase six months from now. Will you be glad you made it?

Pay off all of your high interest credit cards before you start saving. Interest rates will kill you, and you will be on the wrong side of the compounding interest effect. “The best time to plant a tree was 20 years ago. The second best time is now.” – Chinese Proverb

Save up at least six months of living expenses. This will be your rainy day fund. Once you reach this goal, continue to save and funnel your money into your investment accounts. You can reach these goals by saving 20 percent of your income every month, at a minimum.

Income – Fixed Expenses – Variable Expenses = Savings for the Month

Continue to educate yourself. This could be through schooling, certifications, reading nonfiction books in your field, or by simply learning as much as possible your current job and working to move up the ranks.

Whatever you do, never stop learning.

“You can have everything in life you want, if you will just help enough other people get what they want.” – Zig Zigler

For a simple, hands-free investment experience, invest in lifecycle mutual funds. Choose a low-cost, target-date fund like Vanguard Target Retirement 2050 Fund.