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How to be Money Savvy?

Written By: admin on April 27, 2009 No Comment

Being money savvy is the desired goal for all of us. However, only the few are able to completely grasp the concept. It is very easy emerge as money stupid instead of money savvy!
How to recognise money savvy vs. money stupid?
If you’re money savvy you:
– plan for the future taking into account all relevant factors
The key is relevant. Some people might plan for the small expenses and then overlook those that are huge and inevitable. For instance, you might plan for telephone bill but completely overlook the fact that your roof is leaking for last two years and you should repair it. Planning does not require complicated tools, it is enough to use deduction and subtraction and most of all common sense.
– know how to balance time and money in your life
Time is the only resource in our life that comes in limited and unknown amount. Therefore don’t waste your precious time just in order to save few cents. The balance is the key word. Always consider how much time you have to invest in order to save some money, firstly through assigning the value to your time. If you don’t value time that you invest in something, you might end up spending lots of your precious time saving a few bucks.
– know the difference between being thrifty and being cheap
If you’re thrifty you can save money and in the end you will feel good about that and everybody else around you will feel good about you. People that are simply cheap don’t have a good relationship with money and often make other people feel bad around them (for instance if they always find creative ways to make other people pay for their dinner)
– are perfectly aware that there is no thing as a free lunch
Nobody will ever give you something in return for nothing. When something is too good to be true, it usually isn’t. When somebody tells you that everybody makes money investing in something, be sure that this can’t be true. Being careful and realistic is one of the most important qualities that you must have if you want to be money savvy.
– value common sense more than you value anything else
Be grounded at all times and trust your instincts. It is easy to be money savvy in hindsight, it takes a lot of work and dedication to be one now.
– know that there are no easy answers
There are no magical solutions, no magic wands, there is only hard work and dedication in managing your finances.

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