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Personal Finance – 10 Principles of Personal Finance Before I took Personal Finance, the most important financial goal that I had was to pay my bills on time and secure my future through education. After taking Personal Finance, I understand that there is more to the dynamic financial process than balancing my checkbook and getting good grades. By following the 10 Principles of Personal Finance, I hope to be better prepared to meet the challenges of life, and provide for my family, a better future. Ten Principles of Personal Finance Summarized from Personal Finance “Turning Money into Wealth” by Arthur J. Keown 1. Best Protection is Knowledge Personal financial understanding will enable you to plan your future goals and make wise decisions and investments. 2. Have a Plan You have got to have a plan to make things happen. Evaluate Plan Save Execute 3. Time Value of Money Investments grow! Budget Save Invest 4. Taxes Affect Financial Decisions Know the effect of taxes on the return of your investment 5. Stuff Happens Prepare for emergencies, have adequate liquid funds available to cover 3-6 months of living expenses. 6. Waste Not, Spend Not Smart spending starts with knowing the difference between need from want. Make quality purchases Buy at best price Maintain what you buy 7. Protect Against Major Catastrophes Buy life insurance and adequately cover all family members Life Medical Home Auto Personal Property 8. Risk & Return Risk and return go hand-in-hand, diversify! 9. Financial Responsibility Our early years influence how we are “Financially Wired”. Recognize our biases Understanding our patterns Factoring for better habits will insure better outcomes 10. Just Do It! REMEMBER, YES IT IS EASIER TO DO NOTHING, SAVE NOTHING, AND THEN END UP WITH NOTHING! Don’t procrastinate Plan Work through each step