financial rules we should know.

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FINANCE RULES

WE ALL SHOULD BETTER KNOW Imperial Money Pvt. Ltd. Investment Sahi... Future Sahi...


1. Rule of 72 What Is the Rule of 72? The Rule of 72 is a simple way to determine how long an investment will take to double given a fixed annual rate of interest. By dividing 72 by the annual rate of return, investors obtain a rough estimate of how many years it will take for the initial investment to duplicate itself.


2. Rule of 70 in Infliation Divide 70 by the current inflation rate to know how fast the value of your investment will get reduced to half its present value. The inflation rate of 7% will reduce the value of your money to half in 10 years.

HANNAH MORALES


3. What Is the 50/20/30 Budget Rule? 50%: Needs Needs are those bills that you absolutely must pay and are the things necessary for survival. 30%: Wants Wants are all the things you spend money on that are not absolutely essential. 20%: Savings Finally, try to allocate 20% of your net income to savings and investments. This includes adding money to an emergency fund in a bank savings account


4. What Is the Rule of Thumb for Life Insurance A popular rule of thumb for life insurance says that you should have one or more life insurance policies with a total death benefit equal to roughly 10 times your annual salary (before taxes and other paycheck deductions). The death benefit is the amount your beneficiaries receive when the policy pays out, so this is the amount they can use to support themselves after you die.


5. What Is 40% EMI Rule Never go beyond 40℅ of your income into EMIs. Say you earn, 50,000 per month. So you should not have EMIs more than 20,000. This Rule is generally used by Finance companies to provide loans. You can use it to manage your finances.


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