THE BASIC OF FINANCIAL RESPONSIBILITY

THE BASIC OF FINANCIAL RESPONSIBILITY   

What does it mean to be financial responsibility ? It's a complete question with a complex answer , but at its core is a simple truth . To be financially responsible , you need to live within your means . And to live within your means , You must spend less than you make . 

. CREADIT CARDS AND DEBT : If you're really looking to be financially responsible, just being able to make your minimum monthly credit card payment doesn't cut it . In fact , the fact that you aren't able to pay your balance in full shows that you already spend more than you earn . Responsible use of credit means paying the balance on your account in full each month . 

. CONSIDER THE INTEREST : The same logic applies to all recurring payments that involve paying interest . Think about it : Paying interest on anything means that you are spending more on that item that the purchase price . Does that sound like the most responsible choice or just the most convenient ? 

. ACTING IN YOUR OWN BEST INTEREST : For many people , cutting down on interest and borrowing is easier said than done , but in practice , it really comes down to knowing the difference between necessities and luxuries . For example , you might need a car , but you don't need a top - of - the - line model and unless you can afford to pay for it in cash , you shouldn't be driving one . 

. PAYING YOURSELF FIRST - SAVING : Spending every dime that you earn is simply irresponsible unless you have a massive trust fund that is so flush with cash that you will never outlive the earnings . For most people, especially those of us hoping to retire someday , saving is an activity that must be taken seriously . A great way to do this is when you get your paycheck - and before you pay your bills - pay yourself first . A good goal to save is 10% . 

. DON'T KEEP UP WITH THE JONESES : Financial responsibly means doing what you have to do to take care of your needs and the needs of your family . To make this happen , your focus should be internal . The neighbors aren't paying your bills , so their spending habits shouldn't dictate yours or set the bar for your standard of living . 

. ARRIVING At ''RESPONSIBLE'' : Ultimately , financial responsibility means living within your means , regardless of the level of those means . So take a close look at your financial situation , evaluate your earning and spending habits , and make the necessary adjustment to put yourself on responsible financial footing .