Tennis player Boris Becker, who won Wimbledon at the age of just 17, is bankrupt now. His net worth was $25 million earlier. The economic level of the German star can be estimated from the fact that he has to pay a lot of his borrowed money by selling his valuable items like trophies, medals in an auction. In order to avoid such circumstance in your life follow these golden rules –
Never Rely On Credit Cards –
Customers are often promised EMI on Zero Percent on Free EMI Credit Cards. But you would be surprised to know that the terms and conditions apply on EMI on zero percent interest. If you violate one condition, you may have to pay interest of not more than 20% but not 5 or 10. Credit card is the worst thing. We have a lot of ease in swiping cards. In the excitement of spending, we forget the high rate of interest.
Never Take Multiple Loans –
Never in your life, you should take multiple loans. The first rule of smart financing is what the older people have been telling us all the time: don’t live beyond your means. Take a loan that you can easily repay. Getting trapped in a loan trap is very easy. The most affected victims of loan trap are mostly youngsters. A lot of youngsters in the USA are suffering from huge education loan debts.
Start Saving Money –
Losing jobs, becoming u healthy and family problems, all these things are very much unexpected in life that provide a hard time for everyone. You never know when you have to experience such circumstances in life. Whatever you can do now is to prepare yourself for the worst. Start saving enough money to prepare yourself for such future circumstances. Your savings to your income ratio must be 4:10
Avoid bad investments –
Never rely on less profit giving investments. Invest in mutual funds or purchase commodity stocks. Get good health insurance to avoid huge hospital bills later in life. Always start investing a small amount of money for your children’s future and for their higher study in order to avoid them getting trapped into education loans.