Friday, November 27, 2009

Personal Finance For Dummies

People in the richest countries face so many troubles with managing their wealth. Well 2 main factors are responsible for this 1>Bad planning and weak money management habits in spending and using credit cards. The other is the extensive use of advertising, selling, and product availability. If you want to achieve a successful personal financial plan, you must start by identifying your clear-cut financial goals.
Things that you got to keep in mind
Right Timing. Plan and think hard and design your short-term and long-term financial goals.
Financial Target . Consumable-product are items that get used up relatively quickly. For example purchases of food, clothing, and entertainment. Durable-product are just the opposite; these are purchased infrequently and more much expensively, for example appliances, vehicles, and furniture. Differentiation between the two may help you develop and organize a much more practical personal financial plan.
Condition of Life. A 60 year old would spend money differently as compared to 20 years old . Money-spending habits differ according to age, income, household size, and personal thinking and attitude so you should have financial goals accordingly.
Age Financial targets that you Should be having
25-35 years
Financial targets that you Should be having :Focus on creating an emergency fund, Save for a down payment, Buy or get a good life insurance, Make necessary arrangement for your retirement planning.
35-55 years
Financial targets that you Should be having :Build wealth by paying off your mortgage and Gradually strengthen your savings and investments.
50-65 years
Financial targets that you Should be having :focus on providing an adequate retirement fund as more disposable income is usually available

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