6 Basic Principles of Money Management

Note: This information is summarised and edited from external sources.

Money is the thing that we want in our lives. In every sphere of life we require money to buy things, pay our rents, pay off our loans, etc. Many people just lavishly spend their money without know how much money they have in their banks. Most people just dream about money but don’t work for it.

Here are 6 Basic Money Management Techniques that will help you to become a Millionaire by the time you retire:

1. Save at least 10% of what you earn

You have to save at least 10% of your earnings. It’s great of you save more. But the minimum percentage is 10%. If you save 40% of your earnings,   You are going great. But if you don’t, don’t worry. Saving at least 10% from your earnings will help you to invest that money in Assets or Shares.

 
2. Learn to live on 90% or less of your income.

The second Tip is related to the first one. If you save 10% of your earnings, you have to live on 90% or less of  your income. You have to stop buying things that you don’t need. You have to limit your liabilities.

3. Invest Your Accumulated Savings On Assets.

You have to invest the Accumulated money on Assets that will yield high in the future. You have to invest into some projects that will provide a safe and steady income. You can invest in shares, Real Estate, Trading, etc. There are many ways to invest your Accumulated Capital.

4. Invest only in projects in which you have experience.

This is the most common mistake most people make. They invest in areas in which they don’t have knowledge or experience. You should invest only in areas in which you have experience. If you invest in areas in which you don’t have experience at all, chances are you may lose all of your Accumulated money. So better invest only in Areas in which you have experience.


5. Rent your other houses.

If you have more than one house, you can rent the other house. So you can recieve the monthly rents of  your house. This is also a great way to increase your income. You can invest in Real Estate.

6. Always find other sources of income.

What Most people do is they depend only on one single source of income. Never ever depend on one source of income. Always keep looking for other sources if income. This way you can increase your earnings by different ways.

Let”s Revise this up.

In a nutshell, The 6 Basic Principles of Money Management are:

1.Save At Least 10% Of What You Earn.

2. Learn To Live On 90% Or Less Of Your Income.

3. Invest Your Accumulated Savings On Assets.

4. Invest Only In Projects In Which You Have Experience.

5. Rent Your Other Houses.

6. Always Find Other Sources Of Income.

 

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About the author

mazin

Hello visitors,
This is Mazin Shaikh, the author of this blog. I love gadgets, books, and love to help the needy or solve a problem of others. It gives me an immense pleasure to do such things.

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