Ever feel like money slips through your fingers no matter how hard you work? You’re not alone. Most people struggle with savings, debt, and financial planning because they never learned the simple rules that make money easier to manage. 9 Must Read Money Rules For YOU
The good news? You don’t need to be a finance expert to take control. These 9 powerful money rules—from the famous Rule of 72 to the 20x life insurance principle—can help you secure your future and bring peace of mind.
1) Rule of 72 – Double Your Money
Want to know how long it’ll take for your money to double? Just divide 72 by the interest rate.
- At 8% return → 9 years to double.
- At 6% return → 12 years to double.
- At 9% return → 8 years to double.
It’s a quick way to see the power of compounding without complicated math.
2) Rule of 70 – Impact of Inflation
Inflation eats away at money quietly. To know how fast your money’s value will be cut in half, divide 70 by the inflation rate.
- At 7% inflation → value halves in just 10 years.
This is why keeping cash idle is dangerous—you must invest wisely.
3) 4.1% Withdrawal Rule – Financial Freedom
Dreaming of retirement or early financial freedom? You’ll need a corpus equal to 25 times your yearly expenses.
For example:
- Annual expense: ₹5 lakh → Required corpus: ₹1.25 crore.
Invest half in equity, half in debt, and withdraw about 4% every year without running out of money.
4) 100 Minus Your Age Rule – Asset Allocation
This rule helps balance risk and safety.
- If you’re 30 → 70% equity, 30% debt.
- If you’re 60 → 40% equity, 60% debt.
As you age, your portfolio should get safer.
5) 10-5-3 Rule – Returns Expectation
Set realistic return expectations:
- 10% from Equity / Mutual Funds
- 5% from Debt instruments (FDs, Bonds)
- 3% from Savings Account
Expecting more only sets you up for disappointment.
6) 50-30-20 Rule – Income Allocation
Divide your income wisely:
- 50% Needs (rent, groceries, EMI)
- 30% Wants (shopping, entertainment)
- 20% Savings & Investments
This simple budgeting method builds discipline without feeling restrictive.
7) 3X to 6X Emergency Fund
Life is unpredictable. Losing a job or facing a medical emergency can drain savings fast. Always keep:
- At least 3 months of income aside.
- Ideally, 6 months of income in liquid funds.
This buffer gives you breathing space when things go wrong.
8) 40% EMI Rule
Debt can easily take over your life if unchecked. Never let your EMIs exceed 40% of your monthly income.
Example:
- Income: ₹50,000 → EMIs should be under ₹20,000.
It keeps your budget healthy and stress low.
9) Life Insurance Rule – 20x Your Income
Insurance is not about returns—it’s about protection. Always have a sum assured equal to 20 times your annual income.
If you earn ₹10 lakh a year, your life cover should be at least ₹2 crore. That way, your family stays financially secure if something happens to you.