Someone on Quora asked: What are the ten most important things about personal finance a non-finance background person must know? Here are ten of the best answers that’s been pulled from the thread that are applicable to you irrespective of where you live:
Understand there is no free lunch:Promises of quick investment gains or short cuts to building wealth must be viewed with a healthy dose of scepticism. Outlandish claims are either lies or subject you to a massive amount of risk( coughing in MMM, sneezing in Doom, er, i mean Loom) Slow and steady wins the race every time.
Need or Want: Is this a need or a want? Ask yourself that prior to purchases. It is perfectly ok to splurge from time to time, just be mindful of consumerism. Particularly with all the tech we are surround with it is an easy trap to fall into.
Spend less than your cash flow. Easy enough concept, and it is the number one rule.
Ideas are needed: Come up with ten ideas a day. This doesn’t seem like “personal finance” but it is.
Networking: Come up with ten ideas for how two people can help each other. Introduce them and stay out of the way. This is real networking. Not fake networking where people hand business cards to strangers.
On investing: Don’t invest any of your money. Investing is for wealth preservation, not wealth creation, so first you have to make wealth and when you have wealth, never invest more than 2% of your wealth in any one idea.
Monopoly: Don’t enter a business with a lot of competition. Enter a business with a monopoly. This means high profits, high perks, great education.
Read: Read a lot about things that have nothing to do with finance. Then combine them.
Gratitude = Abundance. You can only be grateful for what is abundant in your life or what will be abundant in your life. So, practice gratitude / abundance all day long.
Look everywhere for what is hidden. The people who know personal finance hide the money very carefully. The people who don’t know personal finance, have TV shows about it.