Four Basic Financial Rules for Success
I know, I know.. these rules are written everywhere and it is only financial advice. But, really, you absolutely should follow these four simple rules. If you're missing any one of them, you need to make it a priority to change that. You simply never know when the proverbial rug will be pulled out from underneath you. If it hasn't happened, I hope it doesn't. But, it probably will.
If you've been sure to keep up with these four basics of finance, you'll make it through without being completely screwed. If you've failed to maintain these things.. then.. well, it is likely going to be a rough ride for you. But, cheer up, call you friends and hopefully you've been paying it forward (and choosing your friends wisely).
Lastly, if you're younger and you think this is for later in life, you are wrong. These things need to be done, the moment you consider yourself "independent". And, if you're not up on these things, then you are not truly independent. I urge you not to find out the hard way. Because, honestly, it only takes small changes over time and a little discipline to start maintaining these things. And, to be fair, I know it's not possible for everyone. I am very sorry, if it's not possible for you. I hope things change for you as well.
The Big Four
- Create a Budget
- Establish an Emergency Fund
- Use 1 - 2 Credit Cards
- Use < 30 % Available Credit Per Card
Is that it? Yup, pretty much. The first one will be the most difficult, especially because it's often not viable. Often your expenses will be larger than your income. If that's not the case, CONGRATULATIONS! Create a budget and work on your emergency fund. More likely, if it is the case you have to figure it out. Reach out to loved ones, look for better employment opportunities, sign up for government assistance for whatever you can qualify for. Increase your income as high as possible, so that you can create a manageable budget and start on an emergency fund.
Do not settle for low paying work. It's all good and fine, and of course "someone has to do it". But, that's actually not true. Nobody has to do it. You are worth more, your time is worth more and you're capable of more. It doesn't matter what the task is, if you're donating your time and you need to survive, you are worth the cost of survival.. the "cost of living". If your current employer won't make adjustments for you, you need to consider that job as something that's already in the past.
On that note, it is always easier to get a new job, while you're currently employed. The positives that a future employer sees in a candidate that is currently employed cannot be measured. As well, it empowers you, when you're applying you're very much selling yourself and you do not want to sell yourself cheap out of necessity. When you're employed, you have bargaining power, mainly because you can walk away. That's the right position to be in, when you're going through the hiring process.
Anyway, I waited far too long to take those four things seriously. And, for the most part, I was fine. But, when I wasn't fine, I was on the edge of a very, very, slippery slope. Where one misstep would've likely landed me homeless with no way out. Stay up on these things and that won't be the case.