Simply Investing Blog

Welcome to the first post in the Dummy`s Personal Finance category. By this post I would like to share my philosophy on the personal finance topic. I believe that this topic is really important for everyone. Everybody needs to deal with money. Unfortunately, the knowledge that we acquire during our education is not enough in my opinion. This is the reason why I created this category. I’ll be sharing my personal strategies on the topics that I believe are important. The posts won’t be about getting rich quick schemes, but about having stability in the finances. So, let’s begin.

Let’s start with the approach that I have when it comes to money. My approach is really, really conservative. It’s so conservative that it annoys me sometimes, but I have accepted that this is the price for some stability. When I say conservative, I mean that I try to save at least 35% of my salary every month. I’m trying to maintain a safety net account. Additionally, I keep another safety net account as a backup. Of course, every month I`m adding funds to my stock market portfolio, which is dedicated to the long term goals. Basically, this is a high level view on my philosophy- be as financially secure as possible.

Let’s put some concrete allocation numbers of my salary:
-20% are for the savings fund
-15% are dedicated to the stock market portfolio
-about 25% are related to housing and utility expenses
-about 20% on food
-the rest 20% I can spend as I like

By reading the allocation strategy you can see the annoying part of my approach. Sometimes, seeing a friend spend 100% of their salary on lifestyle expenses is a bit discouraging. But everyone one should choose for himself/herself, what is more important – the financial stability or certain lifestyle demonstration. Of course, I`m not recommending my personal finance strategy to no one. Just to clarify I`m not giving and I won’t be giving any financial advice. I`m just sharing my view on the topic. My strategy is not designed for everyone. Personal finance is a very delicate matter and any decisions should be well considered with the individual’s situation. In my opinion, the best course of action is to consult with a professional financial advisor. Unfortunately, I am not a professional financial advisor as of now.

Let me give you some background on why my personal finances approach is the way I described it above.

I come from a modest background. I have seen different kinds of financial issues while I was growing up. So I have decided that I won’t let such things to happen to me. Of course, I was wrong. As soon as I left my hometown and became a university student, the financial troubles began. During my university education, I had to start different types of side hustles. These were necessary to keep up with my finances. There was a moment when I have decided that enough is enough. I started reading books about personal finance. I also joined such subject in my university. This way I built my knowledge base for a more stable financial future.

I believe that the knowledge is really important. More important in my opinion is the experience. That’s why I have tried almost every strategy and almost every financial product available. In the next posts I’ll describe everything I have learned. I’ll share the best practices I have. I will also discuss the mistakes I have made.

I hope that you`ll join me in my personal finances journey.