When I started this blog, I recommended David Bach's Smart Women Finish Rich to get you started with making personal finance doable. It's very logical and straightforward.
He has other versions for couples etc., but substantially, the basics are the same. Another very popular one is Start Late Finish Rich. There is an Amazon search link to the right of this post. Just type in "David Bach" and see all the options.
Now, David Bach has a website where he shows all the clips where he appears on program such as Larry King Live, The Today Show, Regis and Kelly etc.
Now these videos don't replace the book, in my opinion. But its a great way to get loads of quick and easy tips. Not only can you learn from him, you can learn from the other guests as well as the people who call in. Sometimes the programs he appears on cover job hunting etc, so this video link is a great resource.
Cover via AmazonWhy reinvent the wheel? There are best selling books on Personal Finance. There are countless websites and blogs. Do a little reading and see what is applicable to your situation.
How did I start?
In the first few days of 2009, I read the best seller "Smart Women Finish Rich" by David Bach (don't worry - the information is generic enough for anyone, and he does have different versions). The book was already in my personal library, I just hadn't read it yet. Given the uncertainties we all face, I figured the time was now right. I would highly recommend the book to to help with thinking about saving vs investing (reminder: they are not the same), and also general money management. There is a lot of information specific to the USA, but the general principles are universal, I think.
Next step - application of principles.
For example, that book inspired me to read another personal finance book - but it was a best seller motivational book not a classic "how to" book. Now, I did not have that book in my library, so I went to buy it. But, here's something key, Bach's book had taught me the importance of discipline in spending (which I will get into in a later post), so although I picked up 10 books in the bookstore, I decided that I did not need them - although I wanted them - and decided to buy only the book I intended to buy when I went to the store. By exercising discipline in my consumption of my favorite impulse items, I saved significantly that day! I had saved money by not spending it and not losing savings interest on that money. What's your favorite impulse item or items? Does this story sound familiar - walk into a store for one thing and buy a ton of other things? Now, am I likely to purchase those books later? Sure. But for the time being I can earn interest on that saved money since I am unlikely to read 10 books at the same time :)
Despite the habitual convenience of using a credit card, I used cash to avoid interest charges. This tip came directly from the book, and in a later post I'll get into how to think about various forms of debt. But the main point is that dollar for dollar, interest rate charges will exceed after tax income on savings. So, as much as you save, your net will be negative if you pay high interest rate charges.
Lesson Learned:
Learn from the experts and start applying the principles immediately. Make personal finance a lifestyle change
Make a list of needs - not wants - before shopping. Take the list. Try to stick to it.With discipline and habit, foregone consumption can add up to real savings which earns interest.
Make cash or fee-free ABM cards the preferred payment type. Debt reduction and avoidance reduces the amount of your hard earned savings lost to debt service.
Check back tomorrow for a summary of basic personal finance principles to get you started on your journey!
This blog is to provide tips and tools for achieving financial security. The main emphasis is on personal finance and money management - earning, saving , spending and investing. Importantly, the different between saving and investing will be stressed. In addition to original content, the best of the web will be aggregated to provide you with one location for the latest trends, deals, and money management tips.
It does not matter how much or how little money you have. It does not matter your age or stage in life. Money management is for all people - and we can all benefit from taking specific steps towards managing our finances. Money management, however, is not a one size fit all. And so, I've embarked on a renewed journey to find my personal path in these uncertain times. One of my new year's resolutions was to prioritize personal finances. As such, since the beginning of the year I have embarked upon a journey with daily experiments. To date, the results of those experiments have exceeded my expectations and led me to other experiments.
Every day, I have found an additional way to improve financial security through a myriad of means: saving, conservative spending, money management and even additional earning/or increasing earning potential.
It is my deepest wish that through this blog, others will be inspired to undertake their own personal finance journeys as we are certain that we must learn to live with greater uncertainty.
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