5 tips everyone must consider in personal finance




Money cannot buy happiness but it certainly pays the bills. Each and every one can take up some efficient steps that will eventually keep the individual in a better financial position. To root for personal finance is not only for investors or businessmen rather it is a concern of people from every sphere of life. These tips of personal finance will aid individual of every walks of life whether entrepreneur, businessman, student, service holder, housewife, investors and so on to have a better financial position.

Money cannot buy happiness but it certainly pays the bills.

  1. Keep your savings high but investment higher:

    If you are looking to have a better financial position through only saving then it might not be an entirely sustainable idea.  Depending on what type of saving you are doing, the increase of money from the saving will rely.  Investing has more chance to increase your money rather than saving. So, keep a high amount of saving but along with that make the investment higher.

  2. Show up, do not show off:

    One of a very close friend of Bill gates reported that gates used to drive a car that has a dent in the roof, the dent was made by Bill gates as every day he put his brief case on the top of the roof before opening the car door. He drove that car for many years, why Bill Gates did that when he is the owner of the billion dollar corporation?  Because showing off is not a characteristic of people who make their way to become rich. It does not mean that money should not be utilized for consumption; the point is to not go into extravagant.

  3. Reconsider your assets:

    Robert Kiyosaki in his famous book “Rich Dad Poor dad” said that, what we commonly consider as an asset may not be actually an asset.  He states that if you buy a car, it is not your assets. Because you have to spent more on your car i.e. gas, maintenance, chauffeur etc rather than getting any profit from the car. An asset is that which gives you profit, what we consider as assets sometimes turns out to be liabilities. For example you can buy an apartment and you can give it for rent, then the purchase that could have been your liability becomes your assets. So before you make any financial decision, consider and reconsider whether it is an assets or liability?

  4. Focus on multiple flows:

    Multiply your source of flows.  It is not only a contingency planning rather it will escalate your financial freedom. Optimizing the flows will result in greater outcome and will provide more return from adequate resources. For a simple example, if a student earns some amount of money say from doing tuition then he should seek for other viable source, let it be investing, doing start up, selling items through e-commerce site, and so on. Just like Steve job said, “Do not settle”.

  5. Know the saving-spending game:

    Warren Buffet said “Don’t save what is left after spending; spend what is left after saving”. Whenever you get your paycheck in the hand, keep an amount from there for saving, investment or future risk issues and spend from the amount that is leftover. This can be our way out of the crisis that we have of being broke even if we had money in our hand.  If you can manage to go through this process of spending after saving then you will for sure have financial freedom in the long run.

These are the basic tips that anyone can follow without any hesitance. This is not rocket science or hard to put up with, it is applicable for every walks of people. So we hope that these tips, and significant amount of patience, focus in your long term goal, and enduring effort will make your cherished dream of financial freedom a reality.

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Nafees is a business student, a freelance writer and a top-notch public speaker at dhaka toastmasters club.