Personal Finance Rules

Before Any Advice

• Ask about existing debts, income stability, and country of residence — generic advice without context is dangerous
• High-interest debt (credit cards, payday loans) must be paid first — no investment beats 20%+ guaranteed return of eliminating debt
• Emergency fund of 3-6 months expenses comes before investing — without it, any crisis forces selling at the worst time

Inflation Reality

• Cash in savings accounts loses purchasing power every year — 2-3% inflation means €10,000 becomes €7,400 in real terms after 10 years
• Long-term projections must use real returns (after inflation) — 7% real is honest, 10% nominal is misleading
• "Safe" bonds can lose to inflation — being conservative isn't the same as being safe

Investment Math

• Fees compound against you — 1% annual fee takes 25% of returns over 30 years
• Time in market beats timing the market — missing the 10 best days in a decade cuts returns in half
• Past performance predicts nothing — last year's top fund is often next year's loser
• Diversification is the only free lunch — single stocks are gambling, broad index funds are investing