No Credit Check :: Articles

Share this article!

The Four Golden Rules Of Personal Finance

The Four Golden Rules Of Personal Finance

As long as you're alive, you are a player on the field of the 'money game'...
and you'll need to know the basic rules before you get tagged by the more experienced players!
Many successful people have mentors to guide them in learning the skills that lead to achievement, and I'll do my best to offer you some critical personal finance perspectives.
They say that life is a school where you learn the lesson after the test.
The same thing applies to money, but you can't go back in time to fix catastrophic financial mistakes that you have made over time.

Rule #1: To earn money from money.

The only way to escape becoming a wage slave for the rest of your life is to set aside savings.
Free Superannuation Advice
If you are thinking about rolling over or consolidating your super accounts, need investment advice, help setting up or administering a self-managed fund, we can help save you both time and money. Our national panel of Superannuation Specialists are standing by, ready for your questions!
The profit on your savings can be used to increase your lifestyle spending, reduce the number of years until you retire, or allow you to actually have any retirement at all.
How are you doing so far toward saving and getting it to earn money for you
Every dollar that you spend eliminates its ability to earn money for you in the future.
I am not recommending that you stop eating at restaurants and going to movies, I am recommending that you use some common sense, like looking at your four biggest expenses over the last few months and aggressively finding a way to reduce them.
The biggest obstacle for the first rule is personal debt of any kind (other than a mortgage for your home) or a lease of any kind.
Every personal debt that you incur reduces your net worth which could have been working for you over your life time.
Acquiring personal debt is exactly like putting a large hole in your wallet. In the money-game, a huge transfer of wealth occurs between the ‘Haves' and the ‘Have-Nots' over the words, "I can afford that monthly payment."
Here is a hint the "Have-Nots" are the ones who make that statement.
So please don't ever look at whether you can afford a monthly payment to make a purchase; pay in cash after you've saved for the item. [Everything that you buy with a 0%-interest payment plan must be over-priced.
Behind the scenes, your payment contract is sold to a lender with an interest rate, and retailers don't do this without building-in an acceptable profit for themselves.
Ask retailers how much the item will cost if you pay in full, and you could get a lower price.]

Rule #2: Always keep your finances under control.

The first step in losing financial control and spiralling into debt and money problems is simply not dealing with personal finances.
Prepare for catastrophic financial accidents with health, life, disability, and auto insurance.
Plan and save before you buy something.
Create a balance sheet for yourself at least once a year to see how you are progressing. Pay every bill on time, or contact the creditor to tell them what is going on and make a partial payment.
If you are temporarily unable to handle any of this, ask for some help immediately and find someone trustworthy who will do this for you.
The most common source of financial trouble is a trauma in your life.
This can be a health problem (large expenses or unable to work), an emotional problem (divorce or loss of loved one), or a financial problem (losing a job, cut in pay, relocation, unexpected expenses).
Whichever the source may be, it leads to three emotional problems the first is denial, the second is being overwhelmed, and the third is hopelessness.
Denial causes people to not open their mail and continue spending as usual, and being overwhelmed paralyses people from getting assistance and dealing with the situation.
For example, if you just lost a loved one, balancing your cheque book and paying bills is not high in your priorities.
Unfortunately, tiny amounts of debt grow with interest and penalties into seemingly insurmountable mountains of debt; leaving you with loathsome options such as bankruptcy, poor credit, declining lifestyle spending, and added stress that you bring to relationships and work.

Rule #3: Pay attention to the finances of the people with whom you spend the most time.

Whether they are relatives, friends, or co-workers, these people have the most impact on your financial life. Do they consistently follow the first two rules of the money game Do they earn about the same money as you
If the answer to either of those is "no", then I recommend that you start spending a little less time with them; and this is why. If they don't consistently follow the first two rules, it is unlikely that you will either.
You unconsciously model the people around you, and the more people you are exposed to that don't follow the first two rules, the more likely that you will unwittingly follow them.
No one thinks they are "trying to keep up with the Joneses", but we all do it to some extent, and this is the mechanism.
On the other hand, if they earn a lot more money than you, you may rack up a lot of debt trying to keep up with them (meeting them at their favourite expensive restaurant, joining them for another expensive vacation, buying a new car because yours is the junker among all of your friends, etc.)
On the other hand, if most of your friends earn a lot less than you, you will turn into the group's banker.
For example, you'll find yourself in the pattern of putting your credit card down to pay for dinner and they'll all say they'll pay you back later, but 50% of them never do; and they don't mind taking advantage of you because, after all, you earn a lot more than they do.
Or, you and your friends need to pay a deposit for renting a house and they expect you to write the checks because you have the money available and they do not.
The neighbourhood that you live in also creates financial pressure to violate the first two financial goals.
Your neighbours are likely to become friends (and I've already gone over this), but they also influence the size of your home, extent of your landscaping, price of furniture, and the size of your TV.
So pay very close attention to the finances of your neighbours ... if you don't like how they are measuring up for first two rules, move somewhere more in alignment with your financial goals.
If your family and friends, don't measure up financially, find some additional people to spend time with that have financial habits that you'd like to emulate and learn from.
I have friends with a wide range of income, but it is much more difficult to follow the first two money rules when I am with the extremes from my own income.
You'll just find it easier to reach the next rule when the peer group that you hang out with aligns closer to your economic level.

Rule #4: Accelerate the other three rules

Add to your savings by increasing your income through advancing your career.
It doesn't matter whether you enjoy it; it is a means to an end ... with the end being progress toward the fulfilment of rule #1.
Increase the amount that you save by aggressively lowering four of your highest expenses. Start spending time with people that talk about investing money and are systematically building their wealth the fastest.
The combination of all four of these rules will hopefully offer a next-step for you to take today to start getting more "wins" in the money-game.

Share this article:

Time to Refinance?
If you are seeking lower rates, lower fees and more flexibility in your home loan. you are in luck! Our national panel of mortgage brokers is looking forward to an opportunity to assist you. Apply online for a free eligibility assessment and one of our broker network refinance specialists will get on the case to track down the best deal for your individual circumstances. Without any obligation and at no charge to you!
Caravan Loans Specialists
If you want fast, easy access to a flexible, low-cost loan to get yourself on the road with a new or used caravan, we can make it happen!. Simply complete our short online loan eligibility assessment to see if you qualify ... and you'll also get access to multiple loan offers sourced from our national panel of specialist Caravan finance brokers. No charge, no credit check .. and no obligation.

Finance Articles

How Credit Card Balance Transfers Can Damage Your Credit Rating How Credit Card Balance Transfers Can Damage Your Credit Rating
Since the banks and finance providers have been castigated for the way they seemingly indiscriminately awarded credit to people who could ill afford it, the chances of being accepted for loans and credit cards have decreased. Concurrently, there is a greater focus on individual's being aware of how credit works and what their financial behaviors means in terms of a credit score and history. - read more
5 Smart Money Tips for Australians to Thrive Financially in 2023 5 Smart Money Tips for Australians to Thrive Financially in 2023
As we are entering the new year, it's important for Australians to start thinking about their finances and how they can make the most of their money. Here are five smart money tips for Australians in 2023: - read more
Managing Credit Card Debt Managing Credit Card Debt
If your credit card debt is starting to get out of control - or you simply want to know how to avoid potential credit card pitfalls, you are not alone. Managing credit cards is a problem faced by many who are now drowning in an ocean of debt. Here are some simple strategies that may be of help. - read more
Where To Get A Debt Consolidation Loan When You Have Bad Credit Where To Get A Debt Consolidation Loan When You Have Bad Credit
If you find yourself struggling under the weight of multiple loans, credit cards and other personal debts it can be hard to know where to turn for help. Your lenders may simply be unwilling or unable to give you any wriggle-room. If you find yourself in this situation, then it might be worth exploring the option of online debt consolidation loans - read more
3 Simple, Effective Tips For DIY Debt Settlement 3 Simple, Effective Tips For DIY Debt Settlement
Here we share 3 simple tips to eliminate your debt problems... so you can move on with life without the constant financial stress of dealing with creditors and collection agencies. To get out of debt, though, you do need to put in a little effort, and that's where understanding the process comes in. - read more
Good Debt Versus Bad Debt Good Debt Versus Bad Debt
Some people see debt as a curse. Others see it as a friend. Debt can make you miserable, or it can be used to make you wealthy beyond your wildest dreams. The trouble is, how do we know what is good and what is bad? - read more
Credit Card Secret Guarantee Credit Card Secret Guarantee
Most people use credit cards in some form or another but few truly appreciate one of the special features of credit cards that make using their credit card to insure their purchases. - read more
Choosing the Right Bank Choosing the Right Bank
Financial institutions are located all around the world. If you are looking to open a bank account, whether that bank account is a transactional account or a savings account, you have a number of banking options. - read more
Loan Finance: How to Shop Around Without Damaging Your Credit Loan Finance: How to Shop Around Without Damaging Your Credit
If you are considering taking out a loan, you wouldn’t go out of your way to make it harder on yourself to get approved or to get a good interest rate, would you? Yet many loan applicants would enjoy a considerably better outcome on their loan application if they followed this important rule. - read more
The Four Golden Rules Of Personal Finance The Four Golden Rules Of Personal Finance
As long as you're alive, you are a player on the field of the 'money game'... and you'll need to know the basic rules before you get tagged by the more experienced players! - read more

Finance News

New Challenges for Aussie Home Buyers New Challenges for Aussie Home Buyers
29 Nov 2023:

The latest ANZ CoreLogic Housing Affordability Report for November has revealed a 'triple whammy' effect on prospective home buyers in Australia. Affordability has worsened for not only buyers but also mortgage holders and renters, and unfortunately, the situation is predicted to deteriorate further by 2024. - read more
Baby Boomers' Spending Habits: A Challenge for RBA Baby Boomers' Spending Habits: A Challenge for RBA
28 Nov 2023:

Last week's release of spending data by Commbank IQ has shed light on a concerning trend that is most likely causing headaches within the Reserve Bank of Australia (RBA). - read more
Rise in Small Businesses Complaints to AFCA Indicates Growing Concerns Rise in Small Businesses Complaints to AFCA Indicates Growing Concerns
24 Nov 2023:

In the 2022-23 financial year, small businesses lodged a total of 3,807 complaints with the Australian Financial Complaints Authority (AFCA), indicating a significant increase of 9% compared to the previous year. As a result of these complaints, small businesses received $23.4 million in compensation and refunds, marking a 16% increase from the previous financial year. - read more
Why Embracing AI Can Enhance Your Financial Advice Business Why Embracing AI Can Enhance Your Financial Advice Business
23 Nov 2023:

Sue Viskovic, the founder of consulting firm Elixir Consulting, highlights the importance of incorporating AI into financial advice businesses in an upcoming episode of the IFA podcast. While there may be apprehension regarding the role of digital tools in providing advice, Viskovic emphasizes the continued need for human interaction and trust. - read more
New Insights on Inflation and the Australian Economy New Insights on Inflation and the Australian Economy
22 Nov 2023:

Reserve Bank governor Michele Bullock has issued a warning, stating that inflation will continue to be a 'crucial challenge' for the Australian economy in the next one or two years. While many attribute the current inflationary pressures to supply-side constraints, Bullock emphasizes the underlying demand component that central banks are trying to address. - read more
Gen Zs Financial Concerns Outweigh Other Generations Gen Zs Financial Concerns Outweigh Other Generations
18 Nov 2023:

Financial matters are causing significant worry among Gen Z individuals, with a staggering 68% feeling the pressure according to the recent research findings by ASIC's Moneysmart program, surpassing the concerns of any other age group. This release coincides with the introduction of a fresh consumer awareness campaign by Moneysmart, aimed at empowering Gen Z individuals to quickly acquire fundamental financial knowledge and develop positive fiscal habits. - read more
The Importance of Teaching Financial Literacy to Youth The Importance of Teaching Financial Literacy to Youth
17 Nov 2023:

During a recent outreach program at Penrhos College, Wealth Designers senior financial adviser Dawn Thomas asked a group of Year 9 students about the cohort with the least amount of superannuation. To their surprise, the answer was not what they expected. - read more
AMP's New Business-Focused Digital Bank AMP's New Business-Focused Digital Bank
17 Nov 2023:

AMP Group has announced its plans to launch a digital bank designed for sole traders and small businesses, expected to be operational by early 2025. This venture, aimed at disrupting a ready market, will see AMP partner with Engine by Starling, a UK-based neobank subsidiary, to leverage its modular platform for a scalable and robust infrastructure. - read more
Study Finds 1 in 10 Aussies Unprepared for Financial Challenges Study Finds 1 in 10 Aussies Unprepared for Financial Challenges
11 Nov 2023:

A recent study conducted by MLC reveals that while most Australians recognize the importance of superannuation in achieving financial independence, a significant portion of the population feels ill-prepared to overcome unexpected financial hurdles. The study, called the Financial Freedom study, shows that although many Aussies are actively working towards improving their financial wellbeing, additional assistance is needed to achieve financial objectives and adequately plan for retirement. - read more
Understanding the Recent RBA Interest Rate Hike Understanding the Recent RBA Interest Rate Hike
08 Nov 2023:

Yesterday, the Reserve Bank of Australia (RBA) made the decision to increase interest rates once again. This move comes as inflation in Australia remains stubbornly high and more persistent than anticipated. While there has been some improvement in goods price inflation, the prices of various services continue to rise rapidly. - read more

Need Help Finding a Loan?
Find out now if you qualify and compare rates, offers and options from multiple lenders - without a credit check!
Loan Amount:
All finance quotes are provided free and without obligation. We respect your privacy.

Personal Loan:
A personal loan is usually made by a financial institution to an individual person without the need for the provision of asset security. Personal loans can generally be obtained for any worthwhile purpose subject to the lending criteria of the financ