Philosophies. Everyone has them whether they’re conscious about it or not. The same can be said about money. Most people follow certain financial philosophies that either make them better or leave them in a worse condition.
Having the right set of money philosophies can not only build a brighter future for you and your family, but also allow you to live your life to the fullest.
Of course, there are certain non-negotiables when it comes to the way you manage your money. Taxes are a priority. It is the civic duty of every American. If your tax situation is a lot more complex than others, consider getting the help of tax professionals like the experts of Tri-Merit. Building and diversifying your portfolio is also a good way of ensuring you have enough when you retire.
We have listed a few timeless philosophies about money management that you can incorporate into your life and eventually, teach your children as well.
12 Financial Philosophies to Help You Live a Full Life
1. Your wealth is your responsibility.
If you want to build your wealth right, you have to get up and act on it. It doesn’t come by hoping to win the lottery, marry someone rich, or inherit a fortune from an extremely wealthy distant relative.
2. Treat getting out of debt as an emergency.
Debt is one of the major hurdles that prevent one from building wealth. Get out of debt as fast as you can. The sooner you pay them all off, the sooner you can start building your wealth.
3. Never say “no” to free money.
Whether it’s in the form of somebody handing you a dollar bill or your employer offering to match your 401K, just take it. If you have debts, make sure to still include your 401K in your budget.
4. When used properly, credit cards save you more money.
Some credit cards give you money backs in the form of points. Utilize your credit cards wisely to avoid credit card fees, interests, and surcharges.
5. Don’t be ultra-frugal.
It is okay to spend money. It really is. You don’t need to hold on to every cent you make and DIY everything from soap to candles to multi-purpose furniture.
Doing these things might seem thrifty, but you also have to consider the amount of time and resources you need to get these done — time and resources that could have been spent with family and friends.
Automate your regular payables so you don’t forget any of them to avoid fines and penalties.
7. Find a bank with very minimal fees and investments with low fees.
Yes, they do exist. Some banks don’t charge as many fees for checkbooks, minimum balances, or auto-payments. If you’re considering investments, pick those that have low transaction fees.
8. Things are just that, things.
Don’t be materialistic. Things you don’t need cost you a lot of wasted money, especially if they don’t appreciate over time. A house full of junk and clutter means wasted money and wasted potential investment capital.
9. Savings accounts do nothing for you.
Instead of keeping your money in a savings account where the interest is ridiculously low, put it elsewhere that will allow it to grow rapidly and significantly.
10. Investing is for the long haul.
Investing is a long-term strategy. If you’re serious about it, be prepared to commit to it. It is not a get-rich-quick sort of thing. It takes a lot of time and patience to be successful in it.
11. Health is wealth.
Taking care of one’s health has more benefits than you think. It does not only make you more fit and youthful, it saves you a lot more from future expenses.
Spending on gym memberships (provided you use them), healthier food, and other health and wellness products and services can save you from spending unnecessarily on medication and treatments in the future.
12. Smart people budget to be smart with money.
If there’s one thing that budgeting does to a person, it makes one aware and conscious of what they have and how much they have to work with. This focus on what you can control is one of the guiding principles of financial intelligence.
Benjamin Franklin once said, ”Money never made a man happy yet, nor will it. The more a man has, the more he wants. Instead of filling a vacuum, it makes one.”
At the end of the day, your money philosophies will reflect what you value the most. Your priorities will determine the way you treat money. Just remember, money is a tool that can be a good friend or a bad enemy. Get the right perspective and build the right habits.