If you are someone who is interested in making money, here are some top lessons you can learn by reading books on finance and implement them throughout your work life.
If you are someone who is interested in making money and is interested to know more about it, then you have some to the right place. Here are some of the top lessons you can learn by reading books on finance and implement them throughout your work life.
People generally have a scarcity mind-set towards money. They think that money is not enough in the world; it is really hard to make money online etc. However, by reading such books, slowly your mind-set about money will started changing. You will realize that there is enough money in the world only if you know how to attract it and that will help you to be happy because when you have a scarcity mind-set, you are always worried that you will run out of money, you will stay broke. This often hinders your growth and success rate. So, the first thing you should do is change your money mind-set. A lot of books are going to help you do that; some of which are Dave Ramsey’s Total Money Makeover or Tony Robbin's Money . When you read these books, you will be able to change your approach towards money.
The most important thing you will learn from these books is that budgeting is the most important thing in the world when it comes to managing your money. There are a lot of rules that these books put forward to manage your money. So, the first and the most common rule is the 50:30:20 rule . It says that 50% of your salary should go towards your needs, that is, the essential things you need to buy like electricity bill, food etc. 30% should go towards wants that is the non-essential things that you really want to buy that can be a new dress or a fancy dinner and 20% should go towards savings. However, people believe that the highest percentage that you can allot should go towards savings and the least should go towards wants. Now, needs vary from place to place. Wherever you live at, really influences your needs; and expenses really varies from places to places but what you can control is your savings.
The next thing that these books teach you is that saving is great but investing is more important. Investing is something that you really need to learn if you want to make a lot of money or if you want to be good with money. Make your money produce more sources of income for you by investing. There are so many ways in which you can invest your money. If you want to take a lot of risk, then invest in shares and mutual funds. If you do not want to take risk, fixed deposits are the best way to invest your money.
Frugal living is the key to a happy life. Money should not be a source of your happiness. If it is, then something is problematic. Live frugally and try to attach yourself to happy habits that do not require money. Some examples are reading your favourite book, talking to someone you really like, watching a movie. These are some things that do not really cost that much as compared to expensive things that really do not have much value in life.
All these books keep saying how you should start saving for your retirement the moment you start earning money. Many people regret not saving for their retirement earlier. Also, people who work in the private sector or they are self-employed won’t have a government pension which is a thing to worry about and is a big reason why they should start saving earlier. So, you should try to start saving for your retirement as soon as you can, as much as you can if you do not want to be worried about your future at all. There are enough things to be anxious about and this is just one less worry.
While growing up, we often hear that money changes people but these books teach you that money actually reveals who you truly are. When a person gets money and if that person is good, they are going to support causes that they love because they are good person. If they are bad person, they can have millions or billions but they will not support others because they are inherently bad in that sense. So, money actually reveals a person’s true character. That is something you should think about.
These books also talk about how if you want to be rich you really need to learn how to save money on taxes. Taxes usually take away a huge chunk of your income depending on how much your income is. Although you cannot completely run away from taxes. They are your responsibility. But, if you are living in a society you can save it and that is going to help you a lot. When you start filling your first taxes, it is a whole different feeling of adulting and you get to learn so many things. In today’s world, everyone should know about taxes. This is something that schools should teach.
The next thing that these books teach us is how you should have an emergency fund so that when you have an emergency, you do not lay your hand on in a saving fund that you were putting away for something else. This will help you a lot in managing your expenses when there will be emergency expenses too to make. Emergency fund is basically 3-6 months of your salary or the amount that you need to sustain your normal lifestyle for 3-6 months. The more the amount is, the more helpful it is going to be. Live more frugally than usual if you have not saved your emergency fund yet because you never know when an emergency comes up.
This is a major thing to master in. These books often teach us to buy assets and not liabilities which connect directly to building multiple sources of income. Creating multiple sources of income helps you to take control of your finances. In case one source of income dries up, you will have other sources to incur the loss.
Saving and investing money is great but the next thing that you really need to work on is boosting your money making skills . There are so many types of jobs that you can work on. It is very important to update your skills considering that we are heading towards more uncertain days. So, make sure that you are prepared. And one of the ways to prepare your self is by updating your skills.
These books also emphasize on how you should keep a good credit score, how you should lower your debts and try to not have any debts at all. If you have multiple debts, you should try to clear the ones with the highest interest rates first. I hope that you will give a read to a few of these books at least if not all of them.
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