What Are The Basic Financial Concepts?
As you become an adult and will start to take control of your finances, you’ll need to understand some basic financial concepts.
What Are The Basic Financial Concepts?
When you have a positive net worth, it means you have no debt and the assets that you own have some monetary value.
1. Net Worth
What Are The Basic Financial Concepts?
To fully understand how to build your net worth and be able to retire comfortably, you have to appreciate the value of compound interest. This is when you invest your money and it earns interest over time, but then you let that interest also receives interest.
2. Compound Interest
What Are The Basic Financial Concepts?
Inflation refers to the consistent increase in the cost of goods and services. As prices of goods or services rise due to inflation, it means you’ll able to afford less and less. Essentially, when inflation rises your money has less power.
3. Inflation
What Are The Basic Financial Concepts?
Liquidity is about how accessible your money is currently if you needed it. For example, the cash you have in a savings account is very liquid. Meaning you can go to your bank and get the cash out that you need quickly.
4. Liquidity
What Are The Basic Financial Concepts?
When you work on your mindset it helps shape your views towards money. But it also can help you master things like delayed gratification, impulse spending, practicing gratitude for what you have, evaluating what is important to you, and much more.
5. Money Mindset
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