MONEY Rules
The World Keeps evolving and
personal finance does the same in the past there were rules of money that
people followed and if talked about now would make no sense and it's not that
they were bad but they just didn't stand the test of time following outdated
money advice that has no place in our current economy can do a lot of harm to
your finances you'd end up working a lot harder and still see little to no
progress and if Used continuously they can be fatalistic to one's Financial
growth and today we are talking about these outdated Money Rules
Number one you need a high paying job
to get rich people went to school
to get the skills required to settle for a job get rich through working in that
position for many years and make enough money to retire this model is a relic
of the past And nowadays it's very hard to get rich from your salary alone
today more people find themselves working multiple jobs just to pay the bills
so how many hours of work would one need to become rich there are a few
exceptions of course but in general nobody gets Rich simply on a salary alone
Number two you need a formal education to make money
look around and there are many
millionaires and billionaires that prove You do not need a college degree to be
successful or make money college is an important aspect of people's lives but
it's importance now is different from what it used to be in the past during the
Industrial Age a formal education was needed to get the necessary skills and
people to bring out the most qualified workers but nowadays critical thinking
and Entrepreneurship are what drive the economy and you don't need the four
walls of a classroom to gain skills In these areas to make money now you just
need education not necessarily one from a big fancy Institution
Number three you need to save for retirement
you'll have to live a pretty
Frugal life to save enough money to have just a Frugal retirement as a result
of the High Cost of Living and a generally longer life expectancy retirement
savings aren't really what they used to be retirement savings are useful if
you're an employee but it's best to have A retirement account where you divert
some of your wages to regularly it should be noted though that money saved in
retirement accounts can be invested and bring back more interest than you would
get from your money sitting in just a simple account
Number four you need money to make money
money used to be the only
leverage tool you could use to make more money but as things stand today there
are new and unique ways to start projects and make Money without very much of
it in the beginning most people believe this rule because they try to go really
big all at once most small startups look for loans and credit lines to launch
thinking that's the way you have to go but if you actually start small and
leverage your services to gain traction you'll make money yes having startup
capital is really helpful but it isn't as important as it's made out to seem
nowadays people make money by coding systems providing Services and making
content that is needed by others with little to no money required at the start
Number five work the same nine to five job for years
to be financially stable Once
Upon a Time people finished college to be employed and their earnings were
sufficient to let them lead a stable and prosperous life the longer they stayed
in the role the more they earned with a healthy pension but today crippling
student debt is the first thing adults Have to face and even with that there's
little to no job security like there used to be in the past so to be
financially stable you need to have side hustles or Investments and be prepared
for the unexpected
Number six always pay with cash
now this rule was followed for
many reasons it helped to manage the budget and it also helps you to get
cheaper prices on Goods now yes it's good to avoid accumulating debt by
sticking to Cash only however there are now a lot of benefits to paying with a
credit card the benefits of using credit cards include fraud protection and
cash back bonuses but its main advantage is the ease of purchasing things
online
Number seven be debt free before you invest
people have always sought to be
debt free before they invest but this outdated rule is more of a problem than an
effective solution it's very hard to Get out of debt by simply working hard
earning money and paying your dues you have to find a way to make your money
work for you and investment is the way to do that so more often than not it's
better to keep your debt aside and invest even small amounts so you'll be in a
better position to complement your payments with your investment returns
Number eight have an emergency fund
that can last three months an
emergency fund is a safety net for Unexpected situations and it's been a
lifesaver for many people nothing ever really goes as planned so it makes sense
to keep a substantial sum of money to guide against unforeseen circumstances
but the pandemic has shown us that emergencies can be long term and that funds
can easily be depleted so while three months is ideal to be on the safe side
you should have funds that can last at least six months time
Number nine wait to buy low and sell
High everybody talks about buying
low and selling high but if we're strictly to follow this mentality there will
almost never be an opportunity to buy after all there's always a low price to
the current market in fact if you look at the stock market and indexes after
major crashes at some point it's almost always in an uptrend you should buy
into the market when you're in the right position to do so because if you wait
for the Market to go low you might end up sitting on the sidelines and missing
out for years
Number 10 don't rent what you can buy
you've heard this before that if
you can afford to buy something to buy it instead of renting it whenever you
need it this goes from housing and real estate to Machinery cars just about
everything understandably long-term ownership is good but it doesn't make much
sense when You've got to start paying maintenance fees on something you don't
use very often so if it's going to be used for a short period and you won't
need it after that it's better off to just rent it instead
Number 11. don't pay someone to do something you can do yourself
in the 90s it was fairly normal
for people to do different tasks and house chores on their own it was cost
saving and everyone was encouraged to learn Practical skills but in our world
now and with the amount of Technology that's been incorporated into everything
it can be costly to fix things yourself when you can just pay a professional to
do it also time is money and the time spent fumbling around with tasks could be
used on more serious endeavors
Number 12 you need a financial advisor
to successfully invest in the
past if you wanted to invest you needed a broker a financial advisor Sometimes
an accountant and many other intermediaries with the turn of the century novel
ways to trade profitably have adapted there are plenty of apps and websites out
there you're fine without a financial advisor and you could also use robots and
technical analysis remember though just always invest in things you actually
understand
Number 13 make a certain amount of money at a certain age
range if you oversimplify things
setting a Benchmark age to make an amount of money isn't that bad but instead
of focusing on age you should instead set short-term and long-term goals that
you can work toward gradually they're a much better yardstick for success and
won't leave you feeling like you're a failure if you don't meet these arbitrary
benchmarks
Number 14 only spend on the essentials
truly there are times when you
need to cut back on your spending to have a better financial position in the
past if It wasn't making any obvious benefit to your life you were advised not
to purchase it but nowadays you're encouraged to spend on yourself once in a
while it's easy to get caught up in trying to save every single penny but you
end up depriving yourself of things so it's important to come up with a good
balance so you feel like your needs and wants are still being met but you're
not overdoing it and putting yourself into financial distress
Number 15. your hobbies shouldn't make you money
we've all got Hobbies we dedicate
our free time to in the past people were advised to separate their work from
their Hobbies but nowadays hobbies are a great way to complement your work and
bring in some extra cash While most of us don't encourage Hobbies with the
intention of earning money some of them can develop into successful side
hustles or even full-time hustles that provide a steady source of income and as
You might have noticed none of these rules were outright wrong they just didn't
age so well money plays an important role in our lives and as technology
advances new ways to manage our finances will come up money rules that make
sense to us now might be discarded in the future so we should always keep an
open mind and be flexible in our financial decisions
