What Does an Ideal Financial Starter Kit Look Like?
With a little bit of financial discipline, you can meet all your necessary expenses and save something for a rainy day too. If you’ve just started earning, you may be eager to know about all the tools that can help you achieve this. So, if you are ready to explore new tools like bank accounts, credit cards with no annual fee, reward points, etc., here’s what you need to know.
An ideal financial starter kit should include:
- A savings account: The first rule of achieving financial stability in life is to save a certain proportion of your earnings. This could be 10% or 20% or more depending on your earnings, expenses, and many other factors. So, the most important feature of a financial starter kit should be a savings account where one can put aside a certain fraction of his earnings for rainy days. Savings accounts are interest-bearing accounts that offer easy access and liquidity to your funds for usage in times of emergency.
- Budgeting and Proper Accounting: An important tip for all earners is to budget their expenses for better planning. Budgeting allows you to identify various expenses and allocate your funds accordingly. This is when you can explore options like getting a lifetime free credit card that allow you to manage your expenses in a better way. But avoid going overboard in using a credit card and keep track of all your expenses, their funding, and the due dates for the payments on your credit cards.
- Getting a Credit Card with Lower Interest Rate: Credit cards have emerged as excellent financial tools that allow users to expand their shopping horizon and enable them to even buy things which they could not afford earlier. You should go for a credit card with a lower interest rate since the unpaid balance on your credit card bill is charged with the applicable interest rates.
- Get a Credit Card with Good Rewards Policy: Limited resources and high aspirations can be balanced by getting a credit card with a good rewards points policy. Such credit cards offer users reward points that can be exchanged for cashback, significant discounts on hotel and flight bookings, special sales offer and other attractive deals. You can also avail of the lifetime free credit card offers by various bankers.
- Learn About Investing and Set Aside Some Funds for This: The earlier you start investing, the better are the rewards that you reap. Investment options like insurance policies involve lower premiums when the investor is young and the same goes up with the increase in the age of the investor. So if possible, start investing early.
Although there is no perfect recipe for a financial starter kit, certain essential items include a savings account, a credit card, and some investments.