Five Foundations

By: Jessica Vander Koy & Zachary Bednar

Set up an Emergency Fund

Your emergency fund should be at least $500 for teens and $5,000 for adults. The purpose of an emergency fund is to prepare you for unexpected expenses. Setting up your emergency fund is the first thing that you do when following the five foundations.

Get Out of Debt

Getting out of debt is the second Foundation. It allows you to begin to save money and build wealth.

Pay Cash for Your Car

By paying cash for your car, you eliminate credit interest and the chance of debt. This is the third step when following the five foundations.

Pay Cash for College

Similar to the third foundation, paying cash for college will eliminates credit interest and lowers the risk of debt. This foundation is one of the most challenge because of the high cost of college.

Build Wealth & Give

After completing the prior foundations, you will finally be able to start building wealth. Accumulating wealth allows you to give back to the community and others in need.

Overview

Overall, following the five foundations will help you get your life on the right track, money wise. The five foundations are simple beginners steps that will make a big difference, especially in your bank account. Setting up an emergency fund, getting out of debt, paying cash for your car, paying cash for college, and building wealth and then giving are the key components to successfully living and avoiding any financial problems.