Personal finance includes all the actions taken by an individual or family to manage money in the present while making financial plans for the future. An understanding of personal finance is important to building long-term wealth, and it is especially important for young adults because the benefits of good financial habits accrue over time. Managing a budget and saving money may be the start of your financial journey, but a well-rounded personal finance strategy typically includes other elements.
Achieving long-term goals such as buying a house or starting a business may require making informed decisions about taking on (and repaying) debt through a mortgage or loans. Preparing for retirement and estate planning often includes responsible investments in financial markets, with a portfolio balanced to fit your preferences for risk vs. reward. Shrewd risk management practices may also include the purchase of insurance to cover key assets such as your business, home, or other personal property.‎