Get inspired to create your own journey! Investing your money can help you over time. I use a simple excel sheet on my laptop where I update monthly. It’s a matter of taking charge of your own life and use your earned money wisely as the tool to enjoy life to the fullest. In your personal life, accounting gives you financial awareness. In fact, many financial mistakes are due to the fact that people are not clear about what they really want to achieve in life, nor do they know their priorities, which is what really matters. Personal finance is teaching you how to handle your financial situation and how can you establish a life of wealth in the future. When you have control of your finances, you can qualify for lower interest rates on a home, which means you … Switch to the dark mode that's kinder on your eyes at night time. Once the need for personal finance makes itself obvious, that usually equates to budgeting. The average credit card debt balance for a family in the United States is actually massive $8,284. In this light, personal finance is important to students simply so that they may realize just how vital financial management is when living on your own. One of the commonly misused, not to say abuse, financial instruments is the credit cards…. I write about investment, financial independence, personal finance, and personal development. I have allocated money for consumption every month. The average debt amount owned by families (age 35 to 65) is from $65,000 up to $108,000. Few people save for retirement, you have to have priorities according to your expenses. This is only one example of the many lessons personal finance will teach you. Imagine for a second that you have to make some major damage repairs in your house. With that in mind, this article will consider why personal finance education is important to everyone. Understanding “Why is personal finance important?” can bring you closer to a life with more wealth, balance, and happiness. Do you need a credit card to build a credit history? You are actually already making great progress since your reading my blog . 1) It Builds Financial Literacy Life Events That Require Financial Planning More If you recently received an inheritance, are headed to a new city or are preparing to retire, meeting with a financial planner is an excellent idea. For instance, in Britain, credit card holders can pay 24% (APR) for the outstanding balance. The total cost of the loan is reflected in the Annual Percentage Rate (APR), which is also provided by the financial institution. Financial literacy is the education and understanding of various financial areas including topics related to managing personal finance, money, borrowing, and investing. Credit cards are one of the most expensive financial products (for you) offered by financial institutions. The importance of personal finances in your life. For example, you can be inspired by my personal investment portfolio and read more about the opportunities. Personal finance is the science of handling money. In your answer lies the key to the proper management of your money. Where would you find money to cover the repairment cost? Best Money Quotes - From 5 super wealthy mentors. You can also use debt to your advantage and use it responsibly like you would for example, buying a house/car that you can afford. Prioritize the really important Very often we insist on the concept that money will allow us to achieve our life goals. Personal finance is important because it’s considering a variety of activities related to your finances and how to best manage them. In the end, we end up confusing desires, needs and priorities. The cash which you have saved for “rainy days” is called an emergency fund or reserve fund. Hence, financial stability has several different features. Through a financial plan, you are in a better position to understand your financials through the set measurable financial goals and the effects of … Financial Understanding. The importance of personal finances in your life, 10 financial apps to control your personal finances 2019. The importance of personal finances in your life. octubre 2, 2019, 10:08 pm 47 Views. For example, debt consolidation could be beneficial in a situation when you have different loans, and you are barely making your monthly payments. Income is the money you make from your employment and maybe also side-job or side-hustle but also profit from your investments. It is essential especially in the early years of one’s life as it molds and influences minds to manage finances effectively. In a few words we can then make conscious and effective decisions. Imagine the cost of these families if you consider that financial institutions can charge an interest rate from 10% and upwards. Three Steps to Eliminate Credit Card Debt. Importance of Financial Planning. The more successful we are with our financ es, the better our lives will be either today or down in the line. It’s crazy  . If you borrow money, you will increase your debt levels. If you have loans then I suggest you check these up and see if the agreements can be improved. Savings: It used to be called saving for a rainy day. Planning and caring for our expenses is a tool to achieve our dreams. I simply just asked them and compared with the market trends. Thus, not only you will spend money to fix your problem, but also, your problem now becomes more expensive because of the interest rate you pay to your bank. By keeping on top of your personal finance management you can avoid falling into the easy debt trap that is so rampant in our society. Many dreams of quitting the "rat race" …, I’m financially free in 9 7 years Maintaining a personal budgetis important to lead a happy family. 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