1)
Map your financial future -
Take time to list your
financial goals, along with
a realistic plan for
achieving them. You can go
places you want to go
without a roadmap - but
seldom on the first try.
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2)
Don't expect something for
nothing - Be leery of
advertisements, sales people
or other sources of
financial offers promising
anything free. Like
non-financial opportunities,
if it sounds too good to be
true, it probably is.
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3)
High returns equal high
risks - Recognize that no
one will pay you high
interest rates on a sure
thing. In most cases, the
higher the interest rate
offered to you, the
investor, the higher the
risk of losing some, or all,
of the money you invest.
Diversification of assets is
the best protection against
risk.
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4)
Know your take-home pay -
Before committing to
significant expenditures,
estimate how much income is
likely to be available for
you. Net income, after all
mandatory deductions, is
more important to estimate
than gross income before
deductions.
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5)
Compare interest rates -
Obtain rate information from
multiple financial services
firms to get the best value
for your money.
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6)
Pay yourself first - Before
paying bills and other
financial obligations, set
aside an affordable amount
each month in accounts
designated for long-range
goals and unexpected
emergencies.
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7)
Money doubles by the
"Rule of 72" -- To
determine how long it will
take your money to double,
divide the interest rate
into 72. For example, an
account earning 6% interest
will double in twelve years
(72 divided by 6 equals 12).
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8)
Your credit past is your
credit future - Be aware
that credit bureaus maintain
credit reports, which record
borrowers' histories of
repaying loans. Negative
information in credit
reports can affect your
ability to borrow at a later
point.
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9)
Start saving young -
Recognize that your total
savings are determined both
by the interest you earn on
those savings and the time
period over which you save.
The sooner you start saving,
the more funds you'll be
able to amass over time.
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10)
Stay insured - Purchase
insurance to avoid being
wiped out by a financial
loss, such as an illness or
accident. An insurance plan
should be part of every
personal financial plan.
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11)
Budget your money - Create
an annual budget to identify
expected income and
expenses, including savings.
This will serve as a guide
to help you live within your
income.
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12)
Don't borrow what you can't
repay - Be a responsible
borrower who repays as
promised, showing you are
worthy of getting credit in
the future. Before you
borrow, compare your total
payment obligations with
income that you will have
available to make these
payments.
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