What is Personal Finance?
The concept of personal finance is not new for most people today. There are different definitions but it is really as simple as two words, person and money. Personal finance is a combination of knowledge, skill, and the journey of how an individual or family manages their money and their lifestyle to reach the goal of true financial freedom with peace in mind.
Managing money is an integral part of personal finance, but first people need to understand self-management. Self-management plays a significant role in our day-to-day lives. Having the ability to control our emotions, thoughts, and actions, and to change our lifestyle is the first step toward true financial freedom. Below are eight main elements of self-management:
After understanding self-management and learning how to manage emotions, thoughts, and actions. You can focus on the elements of money management.
Personal finance needs to focus on the person first and money second. Each person has different goals for financial freedom. True financial freedom is not a number for all but a contentment level for each individual or family. One million dollars will not give you true freedom. You can freely buy many things using a million dollars but there are many things money cannot buy. A healthy and wealthy life will start with self-management and then money management. They work together for an enjoyable life.
