The following is an excerpt from Ben Carlson | December 24, 2016 | marketwatch.com |
Meb Faber asked a bunch of us bloggers to give him our top 3-5 most-read blog posts of the year. I looked back at my trusty Google Analytics for the first time in a while and discovered that two of my top three in terms of readership were personal-finance-related posts (this one and this one). I’ve always said that personal finances are more important than portfolio management, but I still think there’s probably not enough people writing or providing education on the topic.
So I’m going to make a concerted effort to write more about personal finance in the coming year.
Here’s my list of 20 personal-finance rules:
1. Salary is not the same as savings. Your net worth is more important than how much money you make. It’s amazing how many people don’t realize this simply truth. Having a high salary does not automatically make you rich; having a low salary does not automatically make you poor. All that matters is how much you save out of your salary.
2. Saving is more important than investing. Pay yourself first is such simple advice, but so few people do this. The best investment decision you can make it to set a high savings rate because it gives you a huge margin of safety in life.
3. Avoid credit card debt like the plague. Carrying credit card debt is a great way to negatively compound your net worth.
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