Best financial tips for beginners

10 Best Financial Tips for Beginners 25-30years Age: A. Personal Finance is all about managing Money. Best way to save money: INCOME - SAVINGS = EXPENSES B. Safe Investment of your Saving Money. World's Second Richest Man Mr. Warren Buffet advised to always follows rules while you make investment. Rule No. 1 - Never loose your money and Rule No. 2 - Always remember Rule no. 1 C. Power of Compounding. Mr. Albert Einstein has said that Compounding interest is eighth wonder of the wonder. When you think about saving your money, don't ignore the inflation. D. Understand the different types of Incomes: Earlier we used to heard about 2 types of incomes:- 1. Active Income - in others words, if someone works physically, then only income will arise like Job, Self employed businesses. 2. Passive Income:- whether a person physically works or not but income will always arise, like Rentals, Internet income, Franchise or any other type of Passive Business System. Now a days a new concept of income is discussed i.e. Portfolio Income. We may invest our savings into Stock Market / Mutual funds / Fixed Deposits or Debt Funds / lend to someone. Return will vary upon the risk involved in all types of the investments. E. Budget: - Budget is all about best use of your hard earned money. we may budget all our income and expenses monthly / Quarterly / Annually to meet our obligations smoothly. F. Always have buffer to create Emergency Fund to meet future exigencies like Medical issues / Job issues / Buy a car / Purchase of Home etc. G. Insurance Policy: Most of us ignore importance of Insurance. Insurance looks valuable when someone meet accident. We can not buy insurance when it is needed most. Always understand that Insurance is not an investment. One should obtain Term Plan, Mediclaim and Health Insurance. H. Good Debt v/s Bad Debt: Always understand the difference between Good Debt and Bad Debt. Good Debt creates positive Cash Flow (for ex. Business Loan, Housing Loan (in some circumstances)) Bad Debt creates negative Cash flow (for ex. Credit Card loan, Personal loan , Car loan etc) I. Financial Planning: Planning for Big Financial needs like Marriage, Education, Home, Retirement and Financial Freedom. Financial Planning is all about creating wealth. J. Always learn tips of investment. Basically Investment is buying or creating assets which generates income & cash flow. Thanks.