Submitted by Solfest

scott sylvester (otherwise known as solfest) is a commodity trader and former banker; he spent 10 years in the banking business, and has developed a set of "financial rules for life", all of which can be found here.

...editor's note - Solfest's rules are focused on personal finance, an important subject any time but especially now given the current economic climate.

Here are Solfest's "Five Rules For Life":

1.) Stop spending money.
"You shall not covet your neighbor's house. You shall not covet your neighbor's wife, or his manservant or maidservant, his ox or donkey, or anything that belongs to your neighbor." - Judges 20:17

How much money you earn has no proportion to your ultimate wealth. Your ultimate wealth is determined by how much money you spend. This is the hardest concept for people to understand as we spend our adult lives trying to earn more money. While this is not necessarily a bad thing, most people really don't have much control over how much money they make. But we all have control over how much money we spend. This is where the bulk of your efforts should be focused - controlling expenses, not chasing income. Even when we are successful in capturing more income our expenses seem to "creep" up at a higher rate.

2.) Manage the money.
"No one can serve two masters. Either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve both God and Money." - Matthew 6:23-25

Are you serving money by managing it or by ignoring it? If you are ignoring it and have no financial options, live hand to mouth, and are buried in debt - then you are a slave to it. If you are the slave, then it is the master.

3.) Learn.
"Blessed is the man who finds wisdom, the man who gains understanding, for she is more profitable than silver and yields better returns than gold." - Proverbs 3:13-14

Learning begins after you leave school, as we [usually] receive no financial training there. If you want to gain this knowledge you have to do it for yourself. The information is there - it’s up to you to find it, read it, and apply it. The time to start is now as the older we get the harder it is to change.

4.) Watch the money.
"She considers a field and buys it; out of her earnings she plants a Vineyard. She sees that her trading is profitable, and her lamp does not go out at night." - Proverbs 31:16,18

Planning, researching, considering, monitoring, tracking, and recording are all traits that create, preserve, and grow wealth. Businesses that are publicly traded are required by law to report to their owners on a quarterly basis. In that report they tell us how they did compared to last year, and compared to the plan they had laid out at the start of the year. There is no business more important than the business of you and your family, so the least we can do is report to ourselves on an annual basis.

5.) Learn to distinguish between good debt and bad debt.
"The rich rule over the poor, and the borrower is servant to the lender." - Proverbs 22:7

If you reserve your debt for appreciating assets, your assets will always be larger than your debt. There are only two assets that fall into the appreciating category - real estate and businesses. Businesses include both private and public companies. This means there are a whole lot of "things" that should not be purchased with borrowed money.

Solfest currently resides in Alberta, Canada.