Personal Finance Basics: Saving Money and Credit
August 25, 2008 by Miranda Marquit
Filed under Finance
When it comes to personal finances, sometimes we need to remember to get back to the basics. If we focus on some of the “bigger” things like investing or crushing debt, sometimes we can get discouraged. Also, sometimes we lose sight of some of the basic truths of personal finances.
I came across two great posts recently that address two personal finance basics that we would all do well to remember: saving money and taking good care of our credit.
Saving money
This is a big one. And I’m not talking about clipping coupons and getting a “deal” on something you might not have bought in the first place. I’m talking about setting aside money and saving it. Gather Little By Little has a great reminder post on great ways that you can start saving money now by making it a priority — and making a plan.
Credit
Credit is another foundation of your personal finance success. Having good credit is essential to help you save money on loan interest charges and insurance premiums, and even can affect whether or not you get a certain job. Single Guy Money offers a great overview of the importance of credit and tips for improving your credit score, which include such items as:
- Maintain a good payment history.
- Try to have more “good” credit.
- Longer credit history.
- Avoid new credit.
- Maintain a low debt to credit ratio.
Can you think of any personal finance basics that you try to remember?
I agree, but I would also like to add that investing doesn’t need to be a “big” thing. If you save at all, you can certainly allocate a percentage of your savings to a low cost index fund and let it grow.
Great point, Vered! I guess my aim was to get to the most basic of the basics! At any rate, a heartily agree with you that a low cost index fund is a great and simple way to invest. And it’s something that you can do automatically.
Miranda – I think point 1 is much more pertinent than point 2. The best financial advice is, for every ten coins you bring in, spend only 9. If you abide by these rules then credit becomes much less of an issue.
Excellent point, Uncommonadvice! Saving should be the foundation of any personal finances plan. And, of course, if you have good habits, the good credit will follow.