In your opinion, what’s the fundamental rule of personal finance? There are many questionable attempts but what exactly is personal finance. A gini co-efficient index has been in position to analyze the gap between the rich & the poor: investing in real & virtual assets vs. earned income consumption. Who do you think attained the rich position?


So, how can I earn more? Some people argued that a rich man is born by virtue, others being lucky in lottery, few lamented on poverty. Do you really think nature fetches wealth to a random guy in the street? Dig past that, your financial independence begins here.


1. Spend less than you earn (full stop).

Got it, end of topic… For most consumers, under normal circumstances, the cold hard truth is that frugality is the exact opposite of cheap. What?! Yes, buying up boatloads of bargain sale, manufactured defunct goods, or any random toy is very costly. Quote: “If you buy things you don’t need, very soon you’ll be selling things you need” – Warren Buffett.


Don’t like him, try to like his billionaire status. Come to think of it, what’s the difference between being frugal and cheap? Cost efficiency is the key to your answer. It’s difficult to unload junk assets inside your garage, why is it so easy to load up junk goods into the bag?

Here are some tips in learning how to be a frugal person:

  • Buy a credit report – seriously? Yes, the focus is to list out negative objects in the credit report card as the item(s) penned down within is pulling your financial standing down, leading to lower credit score & paying a higher interest to finance loans.
  • Use coupons – really? Yes, you’re finding the items being bought at say $10.00 but the next buyer is paying at $8.00. What’s going on? Either the buyer purchased using a coupon or simply via cash back credit cards.
  • Work overtime – what? To offset for the free time spent on shopping especially for a new auto, rental, or mortgage, it’s prudent to just stay inside an office.
  • Don’t spend time comparing prices – insane? Yes, investing time in digging out a competitor’s good at $0.30 difference is an absolute waste of your time – opportunity cost.
  • Invest wisely – whew! Yes, invest your time prudently in securing a higher paying job while keeping your personal expenses the same, easier than said done!

Here’s a secret for you, avoid listening to financial gurus & friends. If these folks were to do what they preached, chances are they’ll be under creditor’s radar for a credit crunch. You can choose to pick the tab today or choose to pick the slab – choose wisely..


2. Optimize your daily spending habits

One good thing about marketing companies is on consumer behaviors. It’s the profit margins that are targeted towards such investments. If you can find the lead behind an agency’s campaign, spare no effort in doing the exact opposite.

i.e. Corporations invested much time in designing a shopper’s layout, for instance a squared title to make you go slower & spending more time digging for golden nuggets.

What do you think? Obviously, circumvent the financial system by planning your trip ahead of Walmart or Cold Storage! It’s time to be a profitable shopper that spends what you need, not whatever is out for impulsive purchases.

i.e. Rate of inflation is growing rapidly, for instance a bunch of grapes or bananas had risen in cost every year, making you consumer lesser than expected on a regular basis.

Does your earned income keep up well? No, you don’t have the bargaining powers to induce your employer for a higher wage unless due for a promotion.

Skip Applebee or Mango studio! Optimize your daily habits today by reading some personal finance books & financial planning guides online. Best of all, they’re free of charge! Never get tempted to increase your credit score temporarily just to buy a new home.


3. Find a hobby for you & family.

Apart from dining at Macdonald, it’s fair to spend some time with your loved ones. One cheap alternative is to find a hobby, gearing to investable asset classes or fixing of your credit report – yes, there’re some people whose hobbies specialized in dealing with finance-related problems and unpaid debts.


Take a moment to digest the following scenarios:

1.      Holding a decent paying job, saddled with mortgage & credit card debts.

2.      Holding a stable job, tied by a mortgage credit loan.

3.      Holding a high paying career, facing endless piles of personal loans & mortgages.

4.      Holding a normal career, debt-free due to prudent savings.

The answer is clear. No one wants a debt collector to be hot on pursuits. You’re taking an extra time in determining a (serious) hobby in drafting a debt repayment plan, soon-to-be a full-time job in fixing bad information of your credit report. The importance of interest rate calc. & financial institution’s approval rate shall be evident when it comes to applying for a new home with a bad credit.


4. Practice the ten second rule.

Are you swiping your credit cards freely? If the answer is yes, probably indulging in Starbucks or Costa Coffee, do take a quick glance at your monthly credit card statements before buying another dose of caffeine. Chances are that $10 bucks or so could be of assistance to paying your additional mobile bills or utilities.


When the time to purchase an object whether good or bad credit, consider following the 10 second rule, countdown ten seconds before re-thinking about the purchase. There’s a 50% chance of you not wanting that item anymore. Record the item into a credit checklist & avoid the same mistake again:

  • Starbucks, moonbucks, or quickbucks – avoid em all!
  • Macs, BK, Wendy – treat your family members once in a while (not daily)!
  • Outdoor BBQ events – lower your frequency does help in both health & wealth!

Soon, you’ll find that the checklist is filled with all of the possible objects that your claimants had planted into your credit report while finding various means in pulling your credit score down. The efforts used in canceling out bad personal assets is more worthy than applying for a balance-transfer scheme at 0 apr too!


5. Listen to bankrupts.

One of the best financial advices originate from ex-bankrupts. Many people don’t know or understand the feeling of signing up for a bankrupt credit card, asking a credit union for a loan, applying for an auto at higher interest, or simply getting rejected 10 times in buying a home. The feeling is very.. uncomfortable!


Don’t make yourself miserable! If you truly care about your personal financial situation, likely the reason of being in here, KIG Hall’s strict procedure will elevate your concerns to new heights. Elevate.. what? My concerns of having a bad credit score in buying a home?

Not the end of world: Many a time, you might be thinking it’s impossible for any lender to borrow you money. While this appears to be true, there are other alternatives in finding some leverage; licensed moneylenders, credit unions, savings & loans association etc.

Patience: Somewhat self-explanatory, you’ve to remain patient in waiting for your bad credit objects to be removed on their own – some taking up to six years or more.

Sale of assets: Terminating of unused credit lines and selling off additional assets do free up your financial positions, but it’s the spending habits that determines the outcome.

Lastly, bankrupts do offer high quality advices. Nobody wants you to be in his shoes, daily reporting to an assigned credit bureau officer, observing curfews in personal spending, and getting alarmed by debt collection agencies – no difference from being a prisoner of unpaid debts!


6. Lease on free credit.

Come again, lease on what? Yes, you’re absolutely right~ Assuming you borrowed money from one of the major financial institutions:

1.      A bank: usually charging interests on personal loans, credit card cash advances, unpaid debts, mortgage loans, or other lines of credit – one road to being a debt slave.

2.      Mortgage service providers: generally building a relationship with you in sealing the deal for new mortgage payments or re-mortgage financing – one road to a foreclosure.

3.      A credit card company: introducing new financial products on a regular basis while charging abnormal interest rates for profits – one road to bankruptcy.

4.      A payday loan servicer: one great way to attract fast cash but also the fastest way to financial distress due to overwhelming interest rollovers – one road to suicide attempt.

Ahh.. where is the part of free credit? All I see is paid credit! Generally, the only way to obtain a free credit without the need of a credit rating agency, a credit bureau report, a credit score, or any other indicators, check the following proven ways..

a.       Ask a friend or relative: usually getting help financially for the first time. Any more financial assistance might be turned down. Ask wisely, return swiftly.

b.      Seek credit union for 0% interest on balance transfer: one legal way is to seek redress from local credit unions and source for an interest-free balance transfer.

c.       Find a part-time job: slow way to repay outstanding debts but build overtime into a retirement savings plan.

d.      Adopt a proper credit control measure: locate your most comfortable way of combating financial terrorism!

e.       Combat identity theft: many consumers are victims to identities fraud thefts – losing most (if not all) of their personal belongings in a short span of time.

Finally, these are some of the best ideas in getting a lease on free credit. If you’re still not convinced, do a quick credit search in the internet for a better understanding of paid interests (not paid debts). Do you utmost best in rationalizing every step in financial decision-making processes.

7. Accumulate cash rebates, not high interests.

Firstly, you’ll be in a shock after seeing the interest rate of up to 12% (usually above 9% on credit cards). Racking up bills & loans in a credit card doesn’t seem to be the right move. Instead, you can opt to use the extra money (savings on interests) to double your investments in an investment or spend it on your family – why pay the banks?


According to Dave Ramsey’s debt snowball strategy, you may choose to pay off your overall debts starting from the smallest ones; utilities & gas, payday loans, credit card bills. Once the smaller interests are gotten rid of, you can fully focus on the bigger unpaid debts; mortgage payments or collateral debt obligations.


Evidently, it’s imprudent to load up a bunch of cash back credit cards in exchange for huge heaps of outstanding loans. What keeps credit card companies from their downfall is the amount of borrowed money being dished out. Don’t fall into the trap of minor rebates but getting into legal suits for no apparent reason.


8. Build an emergency fund.

Contingency planning, at times critical conditioning, is the most probable opportunity in managing sudden occurrence of unpaid debts. Some of the more common impromptu circumstances are; loss of employment, a financial crisis, an expected downturn, job terrorism, change of economic climate, robots taking over manual labors, company downsizing & many others.


The question is: Are you financially prepared? If not, seek immediate assistance from your family members. They’re the first to be involved due to future cost of carry when such financial negativity or upheaval occurs. Do not attempt to conspire or cheat anyone who helped you out of goodwill:

  • Ask for a small capital to start investing
  • Seek small cash to remain financially abreast
  • Request your friends to buy your products/services
  • Help them in financial planning too
  • Get ready to downgrade or move to a cheaper rent
  • Slowdown your current spending habits
  • Download your colleague’s mobile saver’s app

An emergency fund helps you in a major crisis as well as lending a helping hand to others when they needed help. Everyone should plan for contingencies just in case “stormy weathers” appeared out of the blue – retaining your financial composure and tiding through days without proper cashflow or streams of income generating savings for you.


9. Trust no local governments in taking care of you.

It’s a sensitive topic: 401K, IRA retirement, insurance savings plan etc. Doesn’t the government print more money to keep the economy afloat? Then, your value of dollar erodes quickly. Trust no local governments in providing you with relevant financial ration when the economy crashes!


What should you do? Max out retirement. After a long day at work, or sometimes two jobs, it’s imperative to send the earned incomes directly to a locked-up account, personal savings account, interest-generating account, or a retirement benefit plan. Here are some tips & tricks of saving up the right way:

  1. College savings: employees working to save up for college made the wisest choice, stepping up financial education without incurring costs.
  2. Buying an auto: instead of getting an attractive financing rate, why not save up to upfront pay for an auto – less the headache for 9% interest rate or more!
  3. Get a new job: landing in an interview for a higher paying job pays, just risk an opportunity to find a well-paying career (just once)!
  4. Invest in a business: well, your employer certainly won’t issue free shares & pay your dividends on your hard efforts. Take matters into your hands by being an employer!
  5. Monetized your hobby: creating a Youtube channel, or ads integration, there’re tons of money making opportunities for you to monetize!
  6. Pay off all debts: no amount of slogging hardwork pays all bills. Perform the necessary “debt snowballing” technique mentioned above!

And yes, a balance transfer credit card account does consolidate all unpaid debts & finance at a single interest rate calculation. It’s important to continue servicing the payments while finding extra money to repay faster. A 0 apr account is not of permanence. Therefore, invest wisely in your personal expenses and never to take upon high-interest coverage liabilities.


Good to know about personal finance in year 2018

Ever wonder how you can keep up with annual inflation rate in the U.S. or U.K, now is the opportunity to splurge your personal finance growth segment. The reason why many consumer debt reports depicted poor credit score is due to primarily low personal savings accounts & ultra-high credit card consumption. You’re to adopt financial prudence using the above strategies while retaining certain portion of monthly income salary (approximately 10-15%) to tide through emergencies – scenario planning for contingency cash reserves.


Quote of the Day: “Rule 1: Pay yourself first & Rule 2: never forget Rule number 1. – KIG Hall [2013-2018]”


Relevant Topics

» Do’s & don’ts of credit report: List everything out at once!

» Do’s & don’ts of credit repair: Final destination for a credit fix!

» What you need to know about credit score: Outbeat your scorers here!

» What you need to know about credit cards: Never destroy your financial credence!

» What you need to know about credit report: List out your negative info today!

» What you need to know about credit repair: What do you know?


This article was originally published on February 16, 2014. It has since been updated.