Personal finance is the concept of managing money for individuals. Having a good grasp of how to manage finances can be crucial to achieving financial wellbeing.
This article includes tips, suggestions and general information. We recommend that you always do your own research and consider getting independent tax, financial and legal advice before making any important decision.
This article explores what personal finance is and demystifies concepts like budgeting and saving.
Personal finance is the process of managing financial resources to ensure that personal financial goals are within reach.
The personal finance journey begins by evaluating one's current financial situation — knowing how much is coming in (managing income), going out (managing expenses), and set aside for savings.
Once the personal financial landscape is understood, clear goals can be set; whether that's saving for a deposit on a house in five years or saving up for a rainy day.
Finally, a thorough personal finance plan helps facilitate progress and navigate unforeseen challenges.
Managing personal finance effectively requires a strong grasp of money concepts, including budgeting and saving. Here's each one explained in more depth:
There are typically five aspects of personal finance that shape planning and goals. Thinking about them holistically as building blocks to success can help create a strong financial foundation to go on. Here are the key areas to know and some of the financial items that can fall into these categories:
Personal finance usually poses challenges for everyone at one time or another. And staying on top of personal finances may be challenging in a world where time is a scarce resource. From financial planners who help ensure one’s income can support their lifestyle to accountants who help keep taxes in order — enlisting experts can go a long way in helping individuals manage their finances effectively.
Building a rainy day fund helps protect personal budgets against financial shocks — be it unexpected expenses such as emergency car repairs or something more worrisome such as losing income from a job.
But how does one go about creating a "rainy day" fund? Personal finance experts suggest setting aside an amount of money for emergency savings regularly to reach a sum that can cover three- to six months of everyday expenses. These can include groceries, utility bills, and transportation.1
PayPal’s tools include expense tracking to make it easy to stay on track with personal financial goals. With the option to add bank cards and accounts to PayPal’s digital wallet, every payment can be automatically recorded, helping individuals track expenses.
For bigger expenses, PayPal Credit* may help spread the cost, allowing individuals to effectively manage personal budgets for those items when needed.
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