# Even before you get your salary in hand, make sure that 15% of your total pay is electronically transferred to Systematic Investment Plans of old and well-known Mutual Funds. Automate this saving. This is the Pay Yourself First Rule. Let your money work for you and not for others. When you pay bills, your money goes to others.
# As fast as you can, pre-pay your outstanding loans. This may be a bank loan, like home loans or credit-card loans. Even if you have to pay a small early-payment fine, get rid off debt. All debt is bad debt. Get rid of your credit card.
# Instead of buying anything on loan, see if you can put save up for a few years and then make a down payment for the object of your desire. Even before that consider whether 5 years hence you might have any use for the thing you so want to buy now.
# Avoid small, unplanned spending. Have a WRITTEN budget. Make sure to allocate 15% to personal equity-linked savings and another 15% keep aside for a rainy day when you might suddenly need some urgent cash. This way you don’t have to take loans. Loans eat into your savings long after you take them.
# Have a Medical Insurance and a life insurance. These are musts. Medical costs can take away all your money in a jiffy. Your dependants need to be protected if anything ever happens to you. So you need a life-covering insurance.
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Hi there, I liked this article a lot. Where can I get more information? I believe that wat differentiate developing from non developing countries in many ways is the CONSUMER DEBT (mortages and such as well)
Where would the US be right now with no credit cards?
I think you will be helped by Suze Orman and Jack Canfield. Check them out at :
http://www.suzeorman.com
http://www.jackcanfield.com/
Both of them are good as financial advisers though Canfield is considered by many as more of a motivational expert.
Debt is a necessary evil everywhere. & let us rue the day that it becomes a differentiator between developed and developing economies!