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7 Quotes That Will Make You Rethink Your Personal Finances

Selena Maranjian, The Motley Fool

There's a reason that many people repeat and share various quotations, with some of them becoming quite well known -- it's often because they succinctly express a valuable truth.

Finance-related quotations can be especially valuable, because they can help you make more money, save more money, or spend less money, among other things. In short, they can really improve your financial life.

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Here's a look at seven quotes that will make you rethink your personal finances.

Try to save something while your salary is small; it's impossible to save after you begin to earn more. -- Jack Benny 

It's not actually impossible to save effectively when you're older and earning more, but it can get hard -- if you've set up an extremely comfortable lifestyle for yourself, with perhaps a fancy house and lots of luxuries. So there is some truth to Jack Benny's quip. If you start saving a meaningful sum regularly while you're young, you can develop powerful saving habits that will serve you well in life. Remember, too, that your earliest-invested dollars can grow the most for you, as they have more time. A mere $1,000 invested when you're 25 can become almost $15,000 over 35 years if it grows at an average annual clip of 8%. Socking away $5,000 annually for just 25 years can get you to almost $400,000. Increase how much you save and invest each year, and you can amass $1 million well before you retire.

Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pound ought and six, result misery. -- Charles Dickens 

Dickens is exhorting us here to live below our means. It may seem an obvious thing to do, but it's very easy to rack up expenses that we can't really afford, especially when most of us are walking around with credit cards in our pockets. If you saddle yourself with debt, it can cost you many thousands of dollars in interest and can delay your being able to save effectively for retirement, a down payment on a home, and many other financial goals. If you want to be financially secure, don't spend more than you have, with the exception of some occasional low-interest-rate debt, such as getting a mortgage to buy a home or a car loan to buy a car.

Don't tell me what you value; show me your budget, and I'll tell you what you value. -- Joe Biden 

This nugget from former Vice President and current presidential candidate Biden is profound. Most of us would do well to have and stick to a budget in order to achieve our financial goals, and the process of creating a budget can be very illuminating. It involves tracking all your spending for at least several months, in detail. When you tally up the numbers, they can probably tell you a lot. For example, are you spending a lot on meaningful experiences for yourself and your family? Or are you spending a lot on video games and car accessories? Is a big chunk of your income going toward retirement savings -- or toward credit card bills full of charges for clothing bought at the local mall? Is education a major line item in your spending? Is travel? Lottery tickets or casino runs? Taking a close look at just where your money goes can tell you a lot about yourself -- and it might inspire some constructive changes, too.

A nickel ain't worth a dime anymore. -- Yogi Berra 

This quotation from Yogi Berra is a good reminder to us to keep inflation in mind as we go about our financial lives -- because it can really shrink the purchasing power of your future dollars. Over long periods, inflation has averaged about 3% annually, enough to have something that costs $100 now cost about $181 in 20 years. So if you're thinking that getting to a $500,000 nest egg by the time you retire will be sufficient, remember that in 20 years it may only have the purchasing power of about $275,000. Factor inflation into your financial planning -- and perhaps ratchet up your savings goal and your annual contributions. (Know, too, that there are a bunch of ways to increase your retirement income.)

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One of the greatest ways to avoid trouble is to keep it simple. When you make it vastly complicated -- and only a few high priests in each department can pretend to understand it -- what you're going to find all too often is that those high priests don't really understand it at all.... The system often goes out of control. -- Charlie Munger  

Even Henry David Thoreau urged us all to "simplify, simplify." A simplified financial life will make things much easier for you to manage and can lead to better results, too, in both saving and investing. For starters, you might automate as much as you can. Many employers will let you have a set amount routed from your paycheck to a certain bank account or two each pay period. Mortgage and insurance payments can be automated, too. Making good use of a 401(k) account at work can also help you save and invest relatively effortlessly. Meanwhile, consider sticking with low-fee, broad-market index funds for much or all of your investing. They have a long history of outperforming stock mutual funds managed by Wall Street pros. (As of the end of 2018, fully 85.1% of large-cap stock funds underperformed the S&P 500 over the past 10 years, with 91.6% underperforming over the past 15 years, according to Standard & Poor's.)

Like Warren, I had a considerable passion to get rich, not because I wanted Ferraris -- I wanted the independence. I desperately wanted it. -- Charlie Munger  

This quote from Warren Buffett's business partner and best friend Charlie Munger can serve to motivate us as we move through our financial lives, saving, investing, spending, and making countless decisions. Think about what your end goal is, and keep it in mind. It might be, like Munger, to have utter financial independence. It might be simply to amass enough to support you comfortably in retirement, or to get all your kids through college. If you have a solid financial plan for your life and execute it well, you can achieve all kinds of things, even perhaps retiring early.

Formal education will make you a living; self-education will make you a fortune. -- Jim Rohn 

This quote is powerful, reminding us that learning shouldn't end with a diploma. A college degree or a trade certificate can indeed land you a job to support you throughout your life, but if you want to make the most of life -- to earn more, enjoy life more, and become more financially secure -- you'd do well to keep learning. There are myriad articles at Fool.com about investing, personal finance, and retirement planning. You might also read books such as John Bogle's The Little Book of Common Sense Investing, The Little Book of Value Investing by Christopher H. Browne, Common Stocks and Uncommon Profits by Philip A. Fisher, and The Little Book That Still Beats the Market by Joel Greenblatt. Books can go into much more detail than mere articles.

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Selena Maranjian has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.