What is the definition of personal finances? What are personal finances? This is a fairly broad concept under which many of us understand something else. Although this concept often appears in the media, publications, the Internet, many people can not define it. I will use the term of personal finance in many articles on the blog, which is why I decided that it is worth to define them in a nutshell. http://floridavacationrentaldirectory.com for further clarification
Definition of personal finances
You could say that personal finance functions in two perspectives. It is a banking shot and the closest private to us regarding every household.
Private finance in private
It is a few elements inseparably connected with each other, which function in our lives and accompany every day to each of us.
Personal finance is nothing more than the whole of the funds that contribute to the home budget each month. It’s all about the money you earn, manage, spend, and save.
- Earnings – cash that you get from employment, retirement, pension or any other benefit, or source.
- Fees – these are your fixed bills for rent, telephone, electricity, gas, television, which you pay monthly.
- Expenses – money that you spend on everyday purchases such as food, clothing. Expenses associated with smaller pleasures such as, for example, a cinema, a restaurant, a pub, or larger ones such as a summer rest or the purchase of cars, audio / video devices.
- Savings – resources that you save every day and month. Small savings made each day and deposited into a savings account can give a significant amount each year, from which a higher interest rate can be assumed. Wise management of your money can give you significant savings, which in turn can bring you additional profit.
- Investments – it’s money that you have saved and invest to multiply it. The more economical the savings or deposits are chosen for, the more courageous they will decide on more risky ways, such as investment funds.
If you learn to manage your money and manage it efficiently, to save and invest surpluses, you will certainly provide yourself and your family with a safe future.
Personal finances in banking terms
Banks classify this term differently and in their understanding as personal finances, most often a group of financial products intended for an individual customer is defined, such as:
- personal accounts,
- credit cards,
- savings accounts,
- youth accounts,
- mortgage loans,
- loans without certificates,
- refinancing loans,
- consolidation loans,
- car loans,
- cash loans.