Personal finance refers to the management of an individual’s or household’s financial activities, including budgeting, saving, investing, and planning for future financial goals. It encompasses all financial decisions and activities, such as understanding income sources, expenses, debts, and investments. Key components of personal finance include creating a budget to track income and expenditures, saving for emergencies and retirement, managing debt responsibly, and investing in assets to grow wealth. Personal finance aims to help individuals make informed decisions to achieve financial stability and security, enabling them to meet their goals, which may include buying a home, funding education, or preparing for retirement. It emphasizes the importance of financial literacy and the ability to analyze one’s financial situation to make thoughtful choices that enhance one’s quality of life.
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