Key to Personal Finance

This is a key to personal finance. This is not a get rich-quick scheme. If you want something like that. There are a lot of investment scams that can rob you blind.  Let me repeat Personal Finance.

Personal finance is the art of managing your money, saving, and investing.

Managing ones personal finance is similar to making good use of your resources with attainable, realistic goals, ones financial standing will progress in no time at all. This calls for proper planning and monitoring.

Assets and Liabilities are like Profits and Losses.

The basic is to understand the meaning of Asset and Liability.

In personal finance to keep it simple, An asset is something that puts money in your pocket like rental apartments,  your business, and paper assets such as UITF (Unit Investment Trust Fund), bonds, mutual funds, and stocks.

Some people believed that their house or car is an asset.

The truth is an idle asset or an asset that does not produce profit is not an asset in personal finance.

A car is a liability because;

  1. It depreciates in value.
  2. It’s not putting money putting money in your pocket or at least save money on your transportation.
  3. You have to pay for gas, oil change, insurance, maintenance, and other expenses.
Even, your car insurance couldn't possibly cover for everything.
A car accident can cause some serious damage to your personal finance.

It could only become an asset if you use it for business, uber, taxi franchise, or as a company car.

These examples explain that a liability is something that takes money from your pocket. Just like your boyfriend/girlfriend in real life. He/She could be an asset or liability. That’s how personal finance can change your life.

Personal finance aims to take control of your money, instead of the money taking control of you.

In the book Shoppers Economy, it was stated that behavior is a new form of currency for business. Some businesses know how to exploit human buying behavior to profit.

Remember that money is a tool. It could be good or evil depending on the one who is handling it.

Personal finance to achieve financial freedom.

These are the steps you can take now to achieve financial freedom.

  1. Get out of debt – you need to be debt-free first to save your money from penalties. This may sound bizarre but the first step is simply cutting your credit card with a pair of scissors. This will prevent you from creating more debts, and follow the debt avalanche method of Dave Ramsey, by listing down your debt and start paying the debt with the highest interest to lowest.
  2. Build an emergency fund – this fund will only be used to avoid any more debts. Emergencies are accident, job loss, or calamities. If you’re thinking of insurance you are still missing out a lot without an emergency fund. Insurance cannot cover for everything you’ll still have to pay some participation fee or something stupid like that. You can build your emergency fund while paying your debt. Your emergency fund should be at least 3 months of your expense.
  3.  Learn to budget or automate your savings – I gave an alternative option to budgeting because budgeting is not for everyone. People can be categorized in two; the natural born Budgeter and the natural born spender. For the Budgeter, the easiest way to budget is to cut your budget to three; 50% needs, 30% wants and 20% savings. For those who cannot budget, just pay yourself first by automating the payment to another savings account or even better try investing it in a trust fund with an auto-paying features.

Personal finance doesn’t have to be difficult we have a lot of technique here at PesoCodeX. Thank you very much for reading my dear audience.



Francis Noel Nocete

Blogger | Intrapreneur = Entrepreneur + Employee | Investor | Book Enthusiast |

One thought on “Key to Personal Finance

  • November 16, 2018 at 11:55 pm

    Good post. I learn something new and challenging on websites I stumbleupon every day.It’s always useful to read articles from other writers and use something from their web sites.


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