Setting Financial Priorities

by Andy Hough on April 17, 2007

This should be common sense for most people but apparently there are some out there who need help with this. Your first financial priorities should be to meet your basic needs. This would include rent/mortgage,food, and utilities. After meeting these needs than you can decide how to spend the rest of your money. My plan now is to allot half of my excess over my basic expenses to building my emergency fund and the other half to paying down my debt.

It would seem pretty obvious that your basic needs should be a priority but some people have dubious financial priorities. I delivered pizza to a house last night that was without electricity. If you can’t afford to pay your electric bill you probably shouldn’t be spending $30 on pizza. Everyone has different financial priorities but you should pay your basic expenses before spending money on unnecessary items like pizza.

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