Personal Finance 101: How To Get Better With Money

16 Fundamental Truths .

We all want to know, “How do I get better with money?”  Unfortunately for far too many, the answer to the question comes with too many short-term sacrifices.  What I have found over the years are these finance basics will help you improve your financial status.  Are you up to the challenge?

First let’s start with the basics like, what is the definition of personal finance?

Simply defined, personal finance is “the management of money and financial decisions for a person or family including budgeting, investments, retirement planning, and investments.”  The following personal finance tips will lead to better financial decision-making and a healthy behavioral change for a brighter financial future. 


1. Pay God first

It is important to understand that money should not be the only reason why we work every day. Our hope is not in the dollar, the euro or the gold; it is founded on Christ. Personal finance is no different. If we acknowledge our dependence on Christ, we can begin to see how faithful God is. That is why giving is so important. We give so that others hear the gospel and find the same hope that we have


2. Pay yourself second

You may have heard of the principle 10-10-80: Pay God 10%, Pay yourself 10%, Pay the bills with 80%. For some, this seems impossible in your current financial situation. There is no magic way to suddenly change your financial picture so you can use 80% of your income to pay off bills (and yes, bills are debt) and save the other 20%. The reality is that the easiest way is to implement this practice early and make it a priority.


3. Roth IRAs are fantastic

Saving for your future does not have to be complicated. Setting aside money in a Roth IRA can mean huge tax savings for you in the future. Keep in mind that the contributions you deposit into a Roth IRA have already been taxed, so both income and capital are tax-free within the IRA.


4. Take the game!

If you do not take advantage of your employer’s 401 (k) match, leave free money on the table. You can not afford not to take the game, so be sure to contribute so much to a 401 (k) or 403 (b) that you are qualified for a corporate game.


5. Build an emergency fund

Spending 3-6 months is an excellent goal for someone who has already set up a $ 1,000 baby emergency fund. If an emergency arises,  make it a habit of replenishing the emergency fund as soon as possible if you need to use your emergency fund.  


6. Create a budget that works for you

It takes a little time to work and revise your budget. Do not get frustrated. Instead, try using any number of free online budgeting tools to help you track your money more effectively.  There are too many to mention, so try a few then stick with the one that’s right for you.


7. Spend less than you do

Sounds too easy, but it is true. It goes hand in hand with the creation of a budget and should be a no-brainer. Unfortunately, I know all too well as a Finance Coach, and Mortgage Broker, credit card debt is still a problem in America today, which tells me that we live on borrowed money.


8. Eliminate debt with anger

The borrower is a slave of the lender. Do everything you can to pay debts as fast as possible. Put every free dollar into debt, and you will soon realize the freedom that comes with debt free.


9. Invest wise

Do not invest in something you do not understand. Look for a reputable investment company and choose a fund that offers solid diversification. Do not pursue returns and neglect diversification.


10. Use proper insurance

Whether you are looking for automobile insurance or looking for rates for term life insurance, be sure you are not jeopardizing your monthly premium cover. Also, it is always wise to do your research before you sign the contract with an insurance company, as there are often many reservations and fine print that can be overlooked if you are not careful.


11. Investment increases the value

Unfortunately, I have heard the following items called “Investments”: cars, clothing, and electronics. If you are not buying a very rare car or a collectible, these items are simply editions. A true investment increases value and provides a return on your investment.


12. Invest for the long-term

In the wake of recent market crashes, news has highlighted the negative investor sentiment that markets seem to dictate. Too many decisions are made emotionally, and investors lose future profits. If you are there in the long run, you should keep your emotions as far away from to your investment decisions as possible.


13. Extra income is achievable

You can earn money with your passion. With a little bit of creativity, dedication, and hard work, there’s no reason why you should not be able to earn as little as $ 100 a month for $ 1000 or more by doing what you love in passing.


14. 30-day Rule – Keep impulses in check

This can be a challenge, especially for birthdays and holidays. One of the best advice I have ever heard about pulse issues was to create a 30-day rule. Before you buy something impulsively, you should wait 30 days before you buy. If you are still passionate about buying it, think about it. If you are over it, you have just successfully saved some money!


15. Enjoy your money

There is a careful balance that you need to keep while managing your personal finances. If you leave no room for pleasure, you will soon become a slave to your budget and feel overwhelmed and trapped by it. Make it your job to have a little fun every month and reward yourself (rightly) for a good job.


16. Generosity is contagious

We have begun to acknowledge that all our resources are from God and that we can use our finances to spread the gospel. In addition to giving your church or missions, you can practice generosity in the smallest of spaces. Sometimes the little things, like spending money on a friend’s coffee, buying lunch for someone or buying school supplies for a needy teacher, can speak volumes! Is there a better way to share God’s provision in your own life than to take care of someone in need?