Personal Financial Management (English)

 Hello Everyone!!!, I Hope all of you are safe. Safe is currently related to both Physically as well as Financially. Due to this Pandemic everyone has faced many kinds of challenges; mostly challenges were related to Survival of Life! This Pandemic have given us some lessons for  learning us from our past mistakes, such as related to Environment, Our Health, Our Wealth etc. 

  As a Human Being, Hope Never Dies! So, Take a breath, tie your shoe lace and be ready to run for achieving unachievable. Whatever you have done in the past is the result of your todays status. So if you want to upgrade your todays status, then you must need to upgrade your dos.

  During this Pandemic; we have noticed that, the wealth is the only primary thing in our life. Because even if we can't buy the Happiness with the help of the wealth or the money; but at least we can survive with the help of the wealth or the money during certain crisis. This Pandemic has broken the back bones of financials of everyone. Some of us have understood the importance of the wealth or the money in the life. Many of us have broken due to some mismanagement of Financials or effects of Mismanagement of Natural Crisis caused due to us only. So here are some small concepts which will lead you to Billionaire, Millionaire or Multi millionaire exponentially.

The 50/30/20 Principles of the Budgeting Rule-

As per the economics, Our  wealth is not only depend upon the earnings of individual but also on expenses and savings. If you are earning ₹ 60,000/- per month, and you have no expense track then you will lose whatever you are earning. Basically our earning needs to be divided in to three parts such as, 50% , 30%, and 20% of the earning. (Here I am taking earning amount as a amount after tax deduction).

50% of your earning is necessarily used for your Daily Needs stuff. Like groceries, rent, EMI, utility bills (mobile/telephone/water/electricity bills), fuel expenses, for study, insurance premiums and so on. In short, those expenses which are too much essential.

30% of your earning needs to be used for your Wants. Wants like entertainment, fun, shopping, hobbies, traveling trips, gifts etc. As a responsible person in your family you must have to fulfill your family's happiness. Because if your family is happy then only you will have mental freedom for enhancement of your visions or goals. 

20% of your earning needs to be used for your Savings. Saving is not only to dump some amount into the bank account or have some cash as a saving. Saving can be your debt payment, because you will be free from the interest burden and can save more money. Saving can be emergency fund. Such types of funds needs to be easily cashable. Because you will be tension free at the time of some crisis regarding the funds. Saving must needs to be Investing. Investment is the secure path for your better future. So as a young champ, everyone needs to focus on investing lessons. There are several investment ideas or modes where you can invest your savings for your better future. 

Suppose you are earning 60,000/- per month. Then 

You will have 30,000/- for your Daily Needs which have mentioned.

You will have 18000/- for your Fun account.

You will have 12000/- for your Savings.

When you think microscopically then you will realise the importance of a Penny.

Because above figures will make huge difference in your life. Like

Annually you will have 12000×12= 1,44,000 as a saving.

If you are now 30 years old, then you will have almost 25 years for earning.

If we can take 5% growth every year in your earning then simultaneously your savings also will grow by 5%. Then imagine your saving at the age of 55 years.

So, you will have savings within 25 years without any growth =25×144,000=₹36,00,000/-.

This amount will comes without any risk. But it comes with the task of financial disciplines. Nowadays it is very much essential for us to keep some money aside for our second innings as a Pension or Retirement Fund.

Everything is possible with the help of Disciplines. Always keep in your mind that Money is a simple maths but it affects on our life with compound effect.

Thank you!

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