A brilliant article from The Times, Zambia by Madoda Milazi Published:Jan 21, 2009
Find out the 10 basic personal finance rules to keep the debt collector far from your front-door.
The Ten Commandments feature prominently in Christianity and Judaism as moral imperatives to save believers from falling into sin.
Similarly, financial advisers say consumers should swear by the “ten commandments of staying out of debt” to avoid falling into the debt trap. Luke Hirst, managing director of debt counselling firm Debtbusters, shared with Business Times the 10 basic rules of keeping debt collectors at bay.
1 THOU SHALL BUDGET
If you know how much you spend and where you spend it, you are less likely to fall behind on any payments that you may owe.
2 THOU SHALL NOT RIDE AN EXPENSIVE DONKEY
Driving a car you cannot afford is just plain stupid. It’s great to drive a flashy sports car and wear designer labels. But if you are worried about looking good in front of the neighbours, think about how silly you will look when the bank repossesses your car in the driveway while the Joneses are watching.
3 THOU SHALL INVEST SPARE COINS WISELY
For most people, being unable to pay their mortgage is one of their greatest fears. To decrease the total cost of your home loan, pay extra when you can to save on overall interest costs — over a 20- or 30-year loan, the saving can be astronomical.
4 THOU SHALL NOT SWIPE NOW AND PAY LATER
Credit cards are great when you can’t find an ATM, but relying on them to provide you with cash you don’t actually have can be catastrophic. With credit card interest rates as high as 27percent, a simple shopping spree could cost you dearly.
5 RENTING IS NOT A SIN
“South Africans have a mentality that renting is a sin, but in times of rising interest rates and high food costs, the knowledge that your rent is fixed for the term of your lease is a source of great comfort,” says Hirst.
6 THOU SHALL TAKE CONTROL
The minute you think you may be in financial trouble, take control of the situation. Contact your creditors, get hold of a debt counsellor or re-evaluate your budget before it gets too late.
7 THOU SHALL NOT FOLLOW THE HERD
With so much financial advice available, it becomes easy to read generic solutions and tailor them to your own financial situation. Get advice from a qualified expert.
8 THOU SHALL SHOP AROUND
Most people have been with their banks so long that they have no idea what competitive interest rates other institutions might offer. Don’t be a passive passenger in financing your home; shop around.
9 THOU SHALL EAT AT HOME
Everybody likes to eat out, but it’s the little things that add up when you are under pressure.
10 THOU SHALL NOT OVERPAY ON THY INSURANCE
You need insurance, but you should not be paying excessive amounts for it. With so many options available, take your time to shop around. Remember, the big names don’t always provide the most cost effective cover.
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1 comment:
This might be the most logically possible and truthful ways to help you financially! And people who are reading this should try and follow these steps to avoid any financial predicament. I do some of this steps and I can say that they really helped me on my struggles before. I realized I was slowly sliding down on a slippery financial slope. I had to man up and do something about it. I did sacrifices and spent wisely until I fully recovered.
Allan Morais
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