[Money Secrets] Do This In Your 20s and Retire as a Millionaire 🤑

Want to become a millionaire?

Then earning money is not enough. You need to know about money. Financial Literacy is very important in your life.

If you become financially literate, and learn how to handle money, then maybe you won’t have problems in your life and you will know how to use money properly.

If you become financially literate in your life, and learn how to handle money, then your life will become easier, and you will reach one step closer to becoming rich.

The world of personal finance is very big and can look very scary.

There are many big words like Risk, Returns, Mutual Funds.

What actually are these?

If you start in your 20s then you can get many advantages. Today we will talk about 4 things that can make you richer in life. If you want to have an in-depth knowledge about money you can read- Rich Dad Poor dad book.

Are you ready to become rich?

Personal Finance Basics

Basics of personal finances you must know in your 20s BigBrainco. 0 48 screenshot 1

So, today we will talk about 4 such things that you can use in your life, through which you will be comfortable in the future, and increase your money.

These four thing are:

  • Savings
  • Passive income
  • Insurance
  • Debt

#1. Savings Can’t Make You Rich

savings: Savings can't make you rich

Now we will talk about savings. Everyone knows about savings, that we need to save money.

But how do we do this?

Most people call this the 50-30-20 rule, where you invest 50% of your income on your needs, 30% on your wants, luxuries or other things and the remaining 20%, you can keep collecting it as an emergency fund or an investment fund.

Depending on the money you save, you will get your savings or investment fund, through which you can increase your wealth and income.

Now let’s take the example of 2 people who’s salaries are same.

Out of both of them, one of them saves Rs.5000 per month, which makes Rs.60,000 per year.

The other one saves Rs.1000 per month, which makes Rs.12,000 per year.

The person who’s saving the money also might be investing it and they’re ahead of where they were a year ago.

The one who saved Rs.12000, spent the money on their life, and enjoyed their lifestyle but they are in the same place, where they were a year ago.

Wealth doesn’t grow only by saving money.

So how will you increase your wealth?

Earn While Sleeping “Passive Income”

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Once Warren Buffet said “If you can’t find a way to make money wile you sleep, you will work until you die.”

Wealth increases from passive income. What is ‘Passive Income’?

Passive income means the money for which you don’t have to work everyday or put in efforts.

After working, whether you sit or sleep, money should keep flowing in your account.

Most of the people rely on their efforts and active income i.e. their business or salary income for making their life better.

For the purpose of increasing their salary, these people will keep putting in their strength and efforts.

Then there are other people who will make their money work for them, and also make their money run for them instead.

After working, these people can sit and see their money grow.

Like I am writing this post, it is a source of Passive income for me, if tomorrow I don’t write still I will get some money.

You can also invest in Bitcoins, buy stocks. But be careful, because there are many scammers present to stole your money. Just like in the Squid coin scam, hackers stole more than 3 million dollars.

Why have an ‘Insurance’?

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Another important thing that you need to know in your 20s, is ‘Insurance.’

If I give some money to a company in advance so that, in the future when I’m faced with any difficulty or any unexpected expenses, then they will cover it for me. This is Insurance.

There are many types of insurance.

You can buy the insurance of a car, insurance of a house, medical insurance or even the insurance of your life.

Experts believe that, getting medical insurance in your 20s is a feasible option.

If you are healthy in your 20s, and want to buy medical insurance then you will be able to buy it in a lesser amount.

In our life we must have observed that most of the time these ‘unexpected expenses’ are medical expenses.

A research was conducted in America and they got to know that 62% of people had shortage of money due to medical expenses.

So that these situations don’t occur in your life, and you get the money on time during emergencies, insurance is bought.

If you are the sole earner in your family, if you are earning for your family, then you can give life insurance a thought.

If something happens to you in the future, then life insurance gives your family payment and coverage, so that in the future, they can handle their life on their own.

You will see very different and very complex products.

But if you are starting now, please keep your eyes only on simple insurance.

How Debt Can Destroy You?

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Now we’ll talk about loans or debts. You might have heard in your house that loans and debts are not good things, and we shouldn’t take loans or debts throughout our lives.

Loans and debts should be taken for things that you need or things that will improve your life.

If you need a bike or scooter to travel to work, or you need an education loan to get a good degree, taking debts for these things is logical.

So now we will talk about credit cards.

Credit cards have become common these days. Many people use credit cards. But people don’t know that credit cards are just debts taken for a month.

If you don’t pay your credit card bills by the end of the month, then every coming month, you are just adding more and more interest to that bill from your income.

So if you are buying useless things from your credit card, like, if you are doing online shopping, and not paying your whole credit card bill for months, then you will keep paying interest from your income.

End Note

So today we learned about some different concepts of finance, and saw that how these different concepts of finance can help us increase our life and make it better.

But friends, the money is yours, the savings are yours and the wealth is yours, then the responsibility should also be yours.

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