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Personal Finance

by The Motley Fool Canada

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Personal finance isn’t just the art of managing your money. It’s the art of making you rich. Yes, that can mean having a lot of money in your accounts. But it can also mean having a greater sense of peace around money issues. Having a lot of money can be great, but removing the stress from the money equation can often be just as — or more! — valuable.

Understanding how to use credit wisely, how to pay off debt faster, how to not just meet but crush your financial goals, can turn you from a paycheque-to-paycheque spender to an all-star budgeter with a firm plan to retire.

It might not happen overnight. But with the right knowledge, and the determination to put principles into practice, you’ll put yourself on the straight track to your golden years.

You bring the determination. We’ll bring the knowledge. Together we’ll make you smarter, happier, and, of course, richer.

Why is personal finance so important?

Money might not be able to buy you happiness, but proper money management can get you closer.

For many Canadians, money is their worst nightmare, the source of many sleepless nights, and the subject of too many painful, spousal arguments. Learning personal finance principles for the first time — or again — puts the steering wheel back in your hands. That helps you not only take control of your money habits, but also live a happier life you can truly afford.

How to start managing your money now

Here are some quick tips to get you started in better management of your money. Ready for some more? Use the links above to access more personal finance tips or dive into our personal finance checklist.

1. Spend less than you make

Like, way less. When you spend as much as you make — or worse, more than you make — you leave no wiggle room for savings, paying down debt, or covering a surprise expense. Budget your expenses monthly, and aim to save at least 10% of your paycheques.

2. Have an emergency fund

Accidents happen. Unfortunately, they’re usually expensive. Without having emergency cash on hand, you force yourself to take on debt or, worse, dig into your retirement savings. If you don’t have an emergency fund, consider this your wakeup call: aim to save three to six months of expenses in a high-yield savings account.

3. Be strategic about credit cards

Some financial experts will advice you to avoid credit cards. We believe that’s a missed opportunity. If you learn to be strategic about credit cards, you can earn valuable reward points and travel miles no debit card could promise. Just pay your balance in full every month and never miss or delay a payment.

4. Save, save save

At the end of the day, personal finance is about living a better, more peaceful financial life. A big part of that is saving more. For every day you work, retirement is a day closer, and though it may feel far away, it’ll arrive faster than you think. Most Canadians underestimate how much they need for retirement, making the possibility of outliving their savings more likely. The sooner your start saving—and the more you contribute—the more comfortable you’ll feel in your golden years.


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