Do you know these money rules of thumb?

A recent article in the Seattle Times reported on research from Morningstar about the value of simple, easy to understand personal finance rules of thumb. The researchers looked at common rules of thumb like “save at least 10% to 30% of your income” and how following these guidelines related to a person’s overall financial well-being.

What they found was interesting, but not surprising. People who follow the rules of thumb do have higher levels of financial well-being, and the simpler and more specific the rule, the stronger the effect was. In other words, people who follow a few very specific rules of thumb about money tend to be more financially “healthy.”

Three of the rules with the strongest relationship stood out when we read the article; they were:

1. Have an emergency und to cover at least 3 months expenses.
2. Don’t spend more than you make
3. Always pay debt in full when possible.

Why do those look so familiar? Because those are basically the 3 goals we start everyone out with in their BrightDime account. Simple, easy to understand goals really are the best way to start building healthy money habits.