An educational #Thread on Personal Finance Rules we all must know. Have sorted the rules & explained those which are less known to every1 & are very imp. as got many requests to share in details.

Rule of 70
4% Rule for Financial Freedom
100 minus ur age rule
50-30-20 Rule

1/n
1) "Rule of 70"

Divide 70 by current #inflation rate to know how fast the value of ur investment will get reduced to half its present value.

Inflation rate of 8% will reduce the value of ur money to 1/2 in 8.75 yrs.

1 should always consider while calculating net returns!

2/n
3) "4% Rule for Financial Freedom"

Corpus Required = 25 times of ur estimated Annual Expenses.

E.g- if ur annual expense after 45 years of age is 500,000 and u wish to take VRS then corpus with u required is 1.25 crore.

Put 50% of this in fixed income & 50% into equity.

Cond.
Withdraw 4% every year, i.e. 5 lacs.

This rule works for 96% of time in 30 years period.

3) "100 mins your age rule"

It is used for #assetallocation. Subtract ur age from 100 to find out, how much of ur portfolio should be allocated to equities.

Suppose ur Age is 40!!

Cond.
Suppose your Age is 40 so (100 - 40 = 60)

Equity : 60%
Debt : 40%

But if your Age is 55 so (100 - 55 = 45)

Equity : 45%
Debt : 55%

4) "50-30-20 Rule"

It is about allocation of income to expense!!

Divide your income into :-
50℅ - Needs (Groceries, rent, emi, etc)

Cond.
30℅ - Wants/Desires (Entertainment,vacations)
20℅ - Savings (Equity,MFs,Debt,FD)

At least try to save 20℅ of ur income. 1 can definitely save more..

THE END.

Do share so that max people can be educated.

Following rules r not mandatory but necessity just like SL in Trading.

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More from @ydstartupreneur

Jan 2
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To cut things short 200 DEMA is considered as the decider between who is in dominating i.e bulls or bears. Its equally imp. for #investors & #Traders! Price sustaining below it is considered bad for bulls.

1/n
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Lets understand more with e.g's.

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3/n
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