The four basic rules of money

By: Ms. Gail Vaz-Oxlade, May 17, 2012

What are the basic rules of money?

Learning to follow the rules is simple, but it’s not always easy

I tell people all the time that this whole money thing is very simple, but it’s not easy. And there’s a distinction to be made.

The basic rules of money are:

  1. Don’t spend more money than you make. 
  2. Save something. 
  3. If you have consumer debt, you’ve got to get it paid off in three years or less. 
  4. You must mitigate your risks, which means you must have an emergency fund and you must have the right kind of insurance.

Those are the four rules. It could not be any simpler. However, it is not easy, because what it means is that you cannot give in to every temptation that is put in front of you. You cannot put today’s immediate gratification before tomorrow’s need for an emergency fund. The execution of the plan is not easy. But what you have to do is quite simple.

Gail Vaz-Oxlade is one of Canada's most successful and respected financial writers and host of Slice Network’s Til Debt Do Us Part. Her best selling books include: Debt Free Forever: Take Control of Your Money and Your Life, A Woman of Independent Means: A Woman's Guide to Full Financial Security, Dead Cat Bounce: The Skinny of E-vesting, The RRSP Answer Book, The Retirement Answer Book, Shopping For Money: Strategies for Successful Borrowing and The Money Tree Myth: A Parent's Guide to Helping Kids Unravel the Mysteries of Money. She has also been a regular feature writer for The Globe and Mail, Chatelaine, IE: Money and Forum. Visit her website at