This piece is part of my 2016–2026 archive migration. Some original formatting, content, and external links may be missing, changed, or not be optimized.
Start here with your personal finance journey
Key 1
Build a 1-year emergency fund that covers your expenses, bills, and lifestyle for one full year. You can put these funds in a conservative investment account, so you don’t lose the money, so you’re less likely to experience any losses.
An emergency fund affords you the opportunity to:
Take time off if you want.
Cover medical emergencies.
Not feel a rush to acquire a new job if you lose your current one.
Key 2
Don’t get credit cards if they’re a temptation for you to spend money above your means.
If you are a responsible credit card user, utilize it prudently; always have a purpose for each credit card purchase.
Before you make a purchase with a credit card, ask yourself: Can I afford to pay for this in cash at this moment?
The interest rates on credit cards are astronomically high. If you buy something for $1,000, you could end up spending double or triple what you originally paid due to interest and only paying the minimum payments.
Key 3
Avoid debt like the plague. The three types of debt to avoid:
Student loans (debatable)
Credit cards debt
Personal loans
Student loans are okay if you’re 100% sure you will have zero issues paying them back, but many people take out loans for degrees that won’t allow them to pay them off anytime soon.
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Key 4
Save and invest and never stop. Save and invest about 10–25% of your total income no matter what you do. If you want to save a set amount of income by a specific age, determine how much you need to save per year, month, week, or day. Always be ready for a loss of a job, a loss of income, etc.
Key 5
Never depend on one source of income. As I always mention, maintaining only one source of income is like betting all of your life savings on one sick horse.
Multiple incomes sources give you options:
Options to pay down your debt faster.
Options to create the lifestyle you desire.
Options to leave your job or handle a job loss.
Options to invest more money for your future.
For free personal finance classes, calculators, and more, check out the MOAM reader resource page.
This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.