Everyone is different. Your relationship with money depends largely on your upbringing. But with the right work, and time, we can reshape your relationship with money.
What exactly does it mean to be financially educated and why is it so important?
The benefits of financial education are consequential to form the foundation of an abundant life.
Without a proper financial education, people naturally make bad decisions about their money. It is the basis of your relationship with money, and it is a lifelong journey of learning.
The earlier you start, the better off you will be because education is the key to success when it comes to your money.
Let’s start with our children.
We send them off to school every day in hopes that they will get an education.
Next stop: college.
As parents, we encourage our children to do well so they can go to a good college and get a degree. They spend years gaining the skills needed to demand a higher salary; yet little or no time is spent teaching them to save, invest, and grow their money.
With the benefits of financial education made so apparent, it’s just perplexing why so many institutions of learning do not place the same emphasis on financial literacy as they do on other subjects.
It’s not enough to just say, “Do well in school, so you can get a good job.”
Anyone can do that, it’s what you do with your money that counts. Financial education is the difference between those who are controlled by money and those who are the masters of their money. Which do you want to be?
Everyone is different. Your relationship with money depends largely on your upbringing. Two children — one born into poverty and the other raised with multi-generational wealth — will grow up with different habits of spending and saving. Even as we get older, our views depend on personal experiences.
Most people don’t realize the effect finances have on one’s mental and physical health.
High levels of financial stress, as with other stressors, can manifest itself through physical symptoms such as anxiety, headaches/migraines, digestive issues, high blood pressure, muscle tension, depression, and a feeling of being overwhelmed.
We are all too familiar with the news stories about how consumer debt in America is the highest it’s ever been. Students are graduating colleges and universities with massive amounts of debt and are unable to live on their own.
So many families rely on credit cards for everyday expenses and according to polls, most can’t afford a $400 emergency.
Why are so many Americans living this way? Some changes in consumer habits and financial products have made it harder for Americans to manage their finances. In the past, most people used cash for daily purchases. Today, they use credit cards more frequently. And to be honest, most were just never taught how to handle money.
Now, I am not saying you need to be an expert stock trader or know the 6,000 + pages of tax codes. You just need to start with the basics, which unfortunately lots of folks don’t understand.
Becoming financially literate involves learning and practicing a variety of skills related to budgeting, managing, and paying off debts.
An understanding of credit and investment products is also important. Basic steps to improve your personal finances include creating a budget, keeping track of expenses, being diligent about timely payments, being prudent about saving money, periodically checking your credit report, and investing for your future.
This is where a Certified Financial Educator (CFEI) can be helpful.
A CFEI is a financial professional who has knowledge of the financial services industry.
A CFEI does NOT try to sell investment products or manage your portfolio. They specialize in teaching money management concepts and are here to help you take steps toward financial stability.
To learn more about finances and gain control over your life, call, text, or email today.
The bottom line is: Any improvement in financial literacy will have a profound impact on you and your ability to provide for your future.
