Financial expert, Robert Drake, Senior Executive for Financial Literacy for Australian Securities and Investment Commission, has begun an Australian case study for financial education in schools.
This is a comprehensive concept that brings the significance of teaching personal finance early to students. Students benefit most from tools and strategies that achieve behavioural changes, as well as education in schools that offer established pathways for their futures and financial goals.
Seven Personal Finance Tips For Beginners
Here are seven personal finance tips for beginners to consider as part of money-saving, money management, wealth management, financial goals and financial planning success:
1. Create a Compatible Budget:
When there is a pre-set financial goal, creating a budget that reflects these goals is less of a challenge. Create a budget based on the traditional idea of Cash In/Cash Out. Know when cash flow is available and when cash is spent as the basis of a compatible budget that incorporates financial goals.
2. Design a Money-saving Plan of Action:
Saving money should be taught as early as possible so that at maturity, saving is a natural extension of money management experience. Retain sufficient savings should a financial emergency arise assuming there is a savings of three to six months for basic living expenses to avoid using retirement or education savings.
3. Track Spending Carefully:
It is imperative all spending be tracked carefully as a matter of accountability. Use a spreadsheet or apps to calculate daily spending.
4. Understand the Difference Between Money and Wealth Management:
Although money management may lead to wealth management, there is a difference. The former deals with cash on hand while the latter deals with savings accrued.
5. Monitor Interest Rates:
This goes for both savings as well as purchases and credit cards. Interest rates affect financial goals. Know the difference and effects on budgets, savings and expenses.
6. Pay Bills in a Timely, Efficient Manner:
This helps avoid unnecessary fees and maintain money management for success.
7. Keep Yourself Updated:
Study newly emerging financial methods and changes in taxation to avoid financial losses. Financial managers and experts offer the best and most up-to-date methods. Stay current with changes in taxation to calculate the effects on budgets.
The growth of wealth originates with financial education and understanding. Use each opportunity to learn how to save and manage money.