Important Thumb Rules of Finance

Rule Name	Rules
6 months car rule	Your car price shouldn't be more than your 6 months’ salary
Emergency fund rule	You should have up to 6 months of your salary as an emergency fund
Retirement rule	Whenever you have investments of 30 times your current annual income, you can retire.
First-year salary rule	You shouldn't take out more student loans than you expect to make the first year on the job.
Life cover rule	You should take term insurance worth 10 times your annual salary
House price rule	You shouldn't buy a home more than 5 times your annual income. Loan EMI Shouldn’t be more than 40% of your monthly salary.
Diversification rule	No more than 10 mutual funds (Equity, Debt & Hybrid) in your portfolio

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