Download 10 Principles of Personal Finance

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