Personal Finance Basics Everyone Should Know
July 2, 2021 | Daniel Dewitt
Money is a difficult topic to understand, and that's a problem. Personal finance basics are often touched on in economics classes in school, but never fully explained. This can be dangerous, as understanding personal finance basics is necessary to make good economic decisions throughout your life.
Put as simply as possible, personal finances refers to any money that you handle for yourself and your family. It’s a catch-all term for talking about individual saving, investing, and tax planning, among other things.
Here’s what you need to know.
The Five Personal Finance Areas You Should Know About
According to the Corporate Finance Institute, there are five areas of personal finance basics.
- Income refers to any of the money coming into your possession, such as a salary or hourly pay. This is the money from your job.
- Spending refers to any of the money going out of your possession, either as cash or credit (borrowed money). It can either be on necessities (housing, food, water, utilities, etc.) or extras (dining out, entertainment, travel, etc.).
- Saving refers to money that is being stored for future use. These are your long-term savings accounts at banks, money market securities, or even physical cash stored in the home.
- Investing refers to purchasing assets that are designed to give more back than the original amount spent on them. Stocks, bonds, and real estate are all forms of investing.
- Protection refers to money dedicated to preventing major, unexpected life events from ruining your financial situation. Emergency funds and insurance are the biggest players in this category.
It’s important to balance all five areas of your personal finances, as they all play a part in keeping your life stable in the present and going forward.
Planning for Personal Finance Basics
The IRS recommends keeping a solid record of your finances for at least three years, and up to six depending on your income situation. All of that information should be kept both digitally and physically if possible, to avoid loss from fire or natural disasters as well as computer malfunctions and data corruption.
Your financial records should include:
- Important identifying documents like birth certificates and social security cards
- Anything documenting inheritance, including your own will and beneficiary forms
- Any legal paperwork from recent filings, including tax returns
- Bank statements
- Receipts for products that are under warranty, involved in an insurance claim, or to be claimed on your taxes
- Medical and insurance bills
Sort your financial records according to the five areas of personal finance, then according to age with the newest as the most accessible. You’ll want to keep everything in one place and keep it secured so that only you can access it.
When you have everything filed, begin compiling a budget. Determine your income and expenses, and balance them against each other for the best possible outcome, leaving room to save for the future.
Title Pawns in Personal Finance Basics
Knowing where your money comes from is a huge part of personal finance basics. One common financial situation is the use of title pawning to supplement income during more difficult times.
Georgia Auto Pawn, Inc. can help tide you over with up to $15,000 in total. Their title pawning process is simple, can be done in-store or online, and takes only 30 minutes. In less than an hour, you can call any of their locations across the state, hear back from a representative, have your vehicle inspected, and have your title pawn approved to get cash in your hand fast.
You don’t need a checking account to qualify for title pawning, and your credit history and employment status won’t affect your chances of approval. You just need to have a license or state ID, be at least eighteen years old and own the title to a car, truck, or van in good condition. The best part? You can pawn your car and keep it for the duration of the pawn, as it’s the title that stays with us, not the car itself.
How to Get a Title Pawn
- Submit a short inquiry form found on the website.
- Answer your phone when one of our representatives calls you back.
- Confirm your information over the phone and schedule a meeting with a store associate.
- Bring the required items to the meeting (driver’s license, title to your car, and your vehicle for inspection).
- Let the associate inspect your vehicle to determine its value and the amount you qualify for.
- Sign a few papers and get your cash.
Knowing Personal Finance Basics Saves Lives
Good financial literacy helps you avoid massive pitfalls like extensive credit card debt or a lack of emergency funds. It can help you plan for your education or the education of your children. It can allow you to retire on your schedule and keep the way of life you’re accustomed to even on a limited income.
Get Started with Title Pawning Today!
Knowing your personal finance basics means that you’re able to put the money you have in perspective and use it both now and in the future. It means keeping yourself ready for anything life throws at you and being able to spend your life on the things you want to do rather than worrying about money.
This means knowing your income, strategizing your expenses, and even knowing if and when you need to use title pawning. Contact Georgia Auto Pawn, Inc. TODAY to take back control of your personal finances.