10 Practical Financial Tips for the Average Person.

1. Don't believe that making more money alone will make you wealthy.

Simply earning more money does not equate to true wealth.

The author of "My Guide to Financial Freedom" discusses that the three essential elements for the average person to become wealthy include working hard to earn money, learning to spend wisely, and investing in financial management—none of these can be omitted.

2. Don't underestimate the power of compound interest.

I often tell my friends that no matter how difficult it is, we should save money and invest even a couple of hundred dollars each month in mutual funds.

Some people might ask, what's the use of investing a couple of hundred dollars each month? In fact, this overlooks the power of compound interest.

By persisting in regular investments, the effect of compound interest can turn 200 dollars into a million over time.

3. People with less money need financial management even more.

Many people think that financial management is a concern for the wealthy; how can the poor, who have no money, manage their finances?

(Note: The original text ends abruptly, so the translation also ends at the point where the text was cut off.)Here, I would like to share a passage from the book "My Guide to Financial Freedom" by the pavilion master:

"The meaning of financial management goes beyond just investing capital to earn returns; more importantly, it is a financial intelligence mindset. That is to say, how one views money, earns money, and manages money all fall within the scope of financial management. Whether you joyfully spend an unexpected bonus on a designer bag, enroll in a self-improvement course you've been thinking about for a long time, or invest in a financial product, these choices reflect your views on money."

So you see, even without money, one can manage finances, and it is even more necessary for those without money to do so, as this can help improve their financial situation and transition from having no money to becoming wealthy.

IV. To start managing your finances, you might need to:

Begin with small steps, such as trying to keep track of your expenses for a month; saving 100 yuan each month; or starting with a 10 yuan fund investment, etc.

Give yourself small rewards to stay motivated to continue managing your finances.

V. Keep a long-term perspective and don't be concerned with short-term gains and losses.

Many people get anxious as soon as they buy a fund or stock, wondering why it hasn't increased in value yet. They feel that investment and financial management are not suitable for them.

The pavilion master in "My Guide to Financial Freedom" states:

"Investing and financial management is also a high-return, long-half-life activity. The results may not be apparent in the short term, but as time accumulates, the principal continues to grow, and compound interest is quietly at work."Investing and managing finances is not something that can be rushed; it's advisable to take a longer-term perspective and patiently wait for the fruits of your efforts to bloom.

VI. Wealth Management is Not the Same as Frugality

Some people believe that managing finances is akin to living like a monk, unable to go shopping or dine out, and thus, any activity involving spending money is off-limits, focusing solely on saving.

In reality, this is a misunderstanding of the essence of wealth management. It is about organizing current finances and planning for the future.

Spending money is permissible, but it should be done wisely and with value. As we discussed earlier, after receiving your salary, should it be spent on a bag, a course for learning, or invested? By now, you likely have your answer.

VII. Excessive Saving Cheats Life

The author of "My Guide to Financial Freedom" states:

"Truly living well is making the most of limited means. It's about managing your life with quality, style, and interest, even under constrained conditions, that truly defines living well."

If you only know how to save excessively, you are cheating life, and I have deeply experienced this. I used to be extremely frugal, even sparing on meals. Sometimes I would only eat a 1-yuan piece of cake, and even when my stomach growled, I was reluctant to spend more.

In fact, isn't the purpose of wealth management to improve one's life? If all you do is save without any enjoyment or style in life, you truly lose the original meaning of wealth management.Eight, Don't Just Stare at the Keyhole

Li Xiaolai once proposed the concept of a "universal key," which means that when you encounter a locked door, you should look elsewhere for the key, rather than just staring at the lock.

Similarly, to manage finances well, one cannot just focus on money, thinking about how much profit to make from this stock today or that fund. Constantly watching the account, being happy when it rises, and being sad when it falls, is not the way.

In fact, what we really need to do is to improve our analytical and investment skills. We should learn good financial management knowledge and analyze the principles of price fluctuations, so as to truly learn to invest and achieve "passive income."

Nine, Financial Management is the Monetization of Cognition and Ability

People often cannot earn money beyond their level of understanding, a sentiment I deeply resonate with.

Previously, I knew nothing and blindly followed a big influencer to buy a stock, hoping to make a quick profit and then sell. However, I didn't make a profit; instead, I lost 50%. I regretted my decision. Later, after systematically learning about stocks and analyzing the stock myself, I was able to remain calm during price fluctuations and make calculated moves. Finally, today I turned my losses into profits.

It's all tears to talk about it; one must study diligently, research more, and practice more. Only then can the money earned truly be one's own. Otherwise, money earned by luck will still be lost through one's own abilities.

Ten, Consistent Small Profits are More Reliable

Who doesn't want to get rich overnight? Unfortunately, it's really rare to get rich overnight in the world, and there are many who become poor overnight. Therefore, compared to getting rich overnight, consistent small profits are more reliable.Accumulate your wealth bit by bit. Although it may seem like a small amount at first, earning 10 or 20 dollars each day is more reassuring than making 100 dollars on the first day and then losing 200 dollars the next. Investing is a gradual process; don't start with the mindset of wanting to make millions right away. Achieving an annual return rate of 10% is already very commendable. Let's take one step at a time to approach this goal.

These are the few insights I wanted to share with everyone today. I hope they are helpful, and may we all eventually become wealthy.