Gaurav Seth
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Gaurav Seth


Personal finance is like doing exercise: we only pay attention to it when we feel as though we are lacking the need for it and lagging behind. Nevertheless, like doing exercise, staying ahead is what is going to leave us with a sense of accomplishment and security but getting to that point can be a complex and tough road. It is no secret that our finances are going to be the key instrument that dictates a lot of the choices and decisions that we make, which starts the question of why do we ignore what is good for us until it is sitting right in front of us?

Nevertheless, opposite to the popular myths, managing your finances does not have to be a stressful and painstaking process. All it will take is a little bit of the right mentality and being mindful about habits. 

In this article, let’s discuss the Do’s and Don'ts of personal finance.


1. Start a Savings plan:

Perhaps one of the most significant things you can do to start acing your finances is to have a strategic savings plan. This inculcates establishing short as well as long term goals that are going to have an impact in the coming years. 

For instance, while you might not be aiming for retirement right away, it is significant to keep in mind the current financial picture. Moreover, you might have other visions and goals as well such as buying a car, travelling abroad, which while won't take as long as the target it still needs to be aligned with the rest of your financial scenario.

The overarching vision and goal here is to get in the mentality that you can not predict the future but it is never late to start thinking and planning about it.

2. Invest in your credit score:

Your credit score is going to be the blood of your journey towards financial freedom. It is going to dictate everything from what types of rates you are going to avail a loan on to the type of horse you will be able to buy. 

As many credit rating agency notes, it is never too early to start working upon and building your credit score. All it takes is a little understanding of what is credit and how to utilise it along with some strategies with which you can take on off the bat that will assist improving your score amazingly. 

3. Plan for the future:

Planning for the future is of utmost importance. Many of us probably have common goals and visions in our mind, including buying a house, travelling the world etc. Even with bootstrapping it, these are still incredibly expensive ventures but ones we consider worthwhile. 

That is why saving towards them is only only a good idea but the route that is going to leave you with the most enjoyable experience. Along with it, life is full of uncertainties, which you should plan for and be prepared about. 


1. Loaning out your future:

A lot of people adopt the approach of I will spend it and worry about the same in future. We will admit in emergency and uncertain situations this can be absolutely necessary. Nevertheless, loaning things out that you can not afford anytime soon is only going to dig you in a deeper hole than when you initiated. 

This makes whatever you spend your funds on less enjoyable and more of a stress, rendering it practically useless. Happiness is not a short goal but something that you want to last a lifetime, so act upon it. The query here is : How far do you want your funds to go?

2. Rely on your checking account:

A practice many of us are very familiar with is only having our primary checking account as the hub for all our funds. This is a terrible practice as the funds are always available anytime you need. 

Do remember, savings accounts, FDs and even index funds are designed with security in mind which means that you can not just pull from them without a penalty. It is a preventive measure but that is important if you are looking to establish sound principles of financials.

3. Getting in excessive credit card debt:

This is a mistake done by many. If you enquire from anyone who is in credit card debt before, they will tell you it is a relatively easy hole to fall in. After all, when we are given money to spend that you have not earned, it does not exactly feel as though it costs anything. 

This is the clear caution with credit, and something you should be careful about. We are saying that do not get a credit card as there are plenty of good uses, including building credit, accrue rewards off expenses, emergencies etc. The golden rule should be if you can not afford it, then you should not even consider it.