Financial Planning is a journey and it is always nice to discuss the different ideas and experiences.
Cartoonist Scott Adams, whose Dilbert comic strip is a valuable educational tool that teaches what corporate life is really like, recently published a simple and straight forward book on Financial planning. It is called ‘Everything You Need to Know About Financial Planning’. The most interesting part is that the book is of 87 words. Yes – Only 87 words.
Here is the content of the book:
1. Make a will.
2. Pay off your credit cards.
3. Get term life insurance if you have a family to support.
4. Fund your 401(k) to the maximum.
5. Fund your IRA to the maximum.
6. Buy a house if you want to live in a house and you can afford it.
7. Put six months’ expenses in a money market fund.
8. Take whatever money is left over and invest 70% in a stock index fund and 30% in a bond fund through any discount broker and never touch it until retirement.
In Indian context, we use PF instead of IRA and 401K.
Valuable Advice indeed ! Clearly, less is more !