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« More Important than Money: Your Health and Your Mind, Part 5 | Main | Free Career Intensity Daily Book Giveaway at Free Money Finance, May 22 »

May 22, 2006


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There are two very important ideas that are closely interrelated to each other and well worth remembering.

First, never believe that you already know everything you need to know. That isn't true in your personal finances, your career or your personal relationships. If you do your homework, it is possible to know as much as you need to know for the next decision in front of you, but not always.

Second, is that the world and your circumstances are always changing. What worked yesterday may not be what works today or tomorrow because the situation has changed. Life is change. Embrace that idea and focus your energy on changing your life in the ways that you want.

So, how are these points related to this article or these guidelines? The connection is very simple. I'm already doing well with my personal finances. I've managed to stay out of debt for the most part and I'm saving for retirement and my children's educations. I want to do better. Reading FMF has already pointed me to a lot of information I hadn't see before.

The guidelines above are part of a formula for being prepared for change. Being financially prepared for the expected changes in your life such as retirement and educational expenses helps. Having emergency savings for dealing with unexpected changes expands your range of options when those occur.

I believe this article is right in a sense. From being in the business of debt relief, I find that many people who are caught up in high debts used their credit cards as a way of living way beyong their means. Not so much just bad spending habits. The majority of people I speak with use their cards to pay for the large bills they already have that they really could'nt afford in the first place. Not truly realizing that now they are just creating a very horrible debt to the credit card company that will charge them large sums of interest. They walk a very tight rope, any kind of financial downfall in their life at this point can have a huge negative impact.

Unfortunately last year was a record breaking year for the credit card industry they earned over 17 billion alone in penalty fees and there is no reason to believe that this year 2007 is going to get any better.

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