5 Financial Rules you Should Never Break if You Dream of Becoming Rich

5 Financial Rule you Should  Never Break if You Dream of becoming Rich

“Personal finance is much more important than portfolio management,” says Ben Carlson … portfolio manager.

The author of the American blog ” A Wealth of Common Sense” has thus promised to write more about the subject in 2017. To quickly put into practice this good resolution, Carlson began by enumerating simple and effective rules according to him.

1. Wages do not make wealth.

“It’s amazing how many people do not perceive this simple truth,” the author notes. Touching high pay every month does not automatically make you rich. Just as being paid more modestly does not necessarily make you poor. “All that matters is the proportion you put aside from your salary.” Your personal savings must follow the principle that they are worth more than your investments. “Pay yourself first before placing money”. The best investment decision would be to impose a high rate of savings. This provides a huge margin of financial security.

2. Avoid debts on your Credit Card

“We must live below his means, not up to his means,” insists the manager-blogger. The only way to emancipate money is the rule of not running out of money. However, credits remain essential. “The biggest expense over the course of life will be the interest to be paid for a mortgage loan, a student loan, the purchase of a car,” concedes Carlson.

3. Go to the Basics.

For anyone who wants to control their finances, it is necessary to understand their consumption habits. Map expenditures and reduce them on all non-vital items. Strictly enforced is not a way of life that no one dreams about, “but that’s how you build your fortune.” And if personal finance experts love to debate coffee bought at the local Tim Hortons from the street every morning or from the snack box, Ben Carlson is mainly interested in big purchases. If he has any advice on this, it is not to drag on the payment of these purchases.

4. Automate to the Maximum.

A great way to avoid late interests, to simplify oneself, is based on automating tasks. “It takes me a good hour a month to check that everything is under control because everything is in autopilot mode,” says the manager.

Also Read: Incredible 8 Hacks to make Passive Income with less Capital in 2018

5. Save a little more each year.

The trick is to increase your savings rate with every increase at work, for example. And the enrichment strategy will remain incomplete if you do nothing to improve your professional career. “Too many people are stuck in this state of mind that they can not find a better job, take on more responsibility or earn a higher salary. It’s insane, “says the blogger. Moreover, according to him, no one should think about retirement, but each of us should aim for financial independence. “The goal should not be to do everything to get out of the sun. But rather to reach a level where you no longer have to worry about money, “says Carlson.

And to conclude this inventory of open doors on one point: “We may not share some of these ideas, but we must not forget that personal finances remain personal.” To discuss.