5 things about Finance you weren’t taught in school

5 things about Finance you weren’t taught in school you never taught in school life.

Here on this website, I will tell you about 5 things about Finance.

you should follow this rule before you enter the finance world.

without wasting time let’s start

Top 5 things about Finance 

  • A bank is not meant for storage
  • Compound interest
  • the rule of 72
  • 10/20rule
  • 50/30/20/rule

1. A bank is not meant for storage

A bank is not meant for storage.

It’s a place where you deposit your money so that it can be used to generate more money.

The introduction of this section will focus on the topic of the bank being.

A place where you deposit your money so that it can be used to generate more money.

There are a lot of people who believe that banks are meant for storage.

They think that they can just store their money in the bank and then forget about it.

But that is not how it works.

Banks are not meant for storage, they are meant to help people with their finances.

2. Compound interest is important in the financial world

Compound interest is a type of interest that accumulates on top of the principal sum.

The accumulation takes place due to the reinvestment of the original amount.

Which is also known as the “principal sum”.

This is a type of interest that can be calculated by using a formula.

Compound interest helps us understand the power of time and how it can affect our finances.

It helps us plan for our future and how we will manage our money as we grow older.

3. The rule of 72 in finance

The rule of 72 is a simple calculation for how long it will take for money to double.

And the rule of 72 states that if you divide the number 72.

By the interest rate, you will find out how many years it will take for your money to double.

Many people use this calculation when they are saving up money so they can retire.

Buy something that costs more than what they currently have.

When calculating the time it will take to double their money.

And they need to know if their interest rate is compounded annually or not.

Because if there are two different interest rates with different compounding periods.

And then the rule of 72 needs to be applied to both rates separately in order to get accurate.

Estimation of how long it will take for their money to double.

4. 10/20 rule

The 10/20 rule is an important rule in finance that can be used to calculate the value of an investment.

The rule states that the return of an investment is equal to the sum of its initial value plus 10% plus 20% of its initial value.

The 10/20 rule has been around since 1881 and it has been used for many different purposes.

One such use case is to calculate the price at which a company should repurchase its own stocks.

The 10/20 rule in finance is important because it can be used to quickly assess.

Whether or not an investment might be worthwhile without having to do too much math.

5. 50/30/20/rule in finance 

The 50/30/20 rule in finance is a guideline for how much of your money.

Should be allocated to different types of investments.

It is a simple yet effective way to manage your finances.

The 50/30/20 rule is a guideline for how to spend your money.

It divides your income into four categories and tells you how much should be spent on each category.

1st categories

In these first categories 50%

This is the money that you use to cover your necessities such as food and shelter.

2nd categories

And the next category is 30%. This money should be used for necessities such as clothing and transportation.

3rd categories

The third category is 20%, which can be used for entertainment, hobbies.

Or anything else that falls under this category.

4th categories

The last percentage (10%) should be saved and put away in case of emergencies.

Conclusion

this basically general few roles in financial world you never ever taught in school days.

Basically this role work in whole life you should know that 5 things about Finance

I hope you like my Article share this post with your neighborhood friends circle.

So they will know about this information.

that’s for today’s thank you for reading my blog

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