6 Financial Rules You Must Follow To Wisely Manage Your Money

50/30/20 Rule: Divide your monthly income into 50% needs, 30% wants and 20% in savings. Needs will include your monthly food and fuel expenses, rent. Wants will include things you desire to buy like a new vehicle, for vacation and so on. Savings will include money that should not be touched every month and should be save for future emergencies or investments.

When you are about to spend heavily on something, wait 24 hours and ask yourself, "Do I really want it?" If you still get yes as an answer, go for it else no. This will prevent you from buying something impulsively and save your money.

As soon as you get your monthly salary, make sure to transfer a fixed amount in your savings account or just automate it.

Build an emergency fund so that you don't have to rely on credit cards for unexpected expenses. It is recommended that you save at least for three to six months required for your living expenses.

Invest for the long term through accounts that can allow you to make more money until you are older like 401(k)s and Individual Retirement Accounts (IRAs). Consult a financial professional for a better understanding.

Build a diverse range of investments to manage your money effectively by investing in private equity, stocks, bonds, venture capital and commodities. Diversification reduces risk as all your money isn't invested in a single place. The biggest financial rule as quoted by Miguel Cervantes in his book Don Quixote, "Don't keep all the eggs in one basket."