Financial education is much more than just knowing how to save money. It consists of practices that have the objective of bringing quality of life both in the present and in the future. It teaches how to build a financial plan that aims at well-being.
This way, you get control of your money and have more awareness of what to do with it. Of course, saving, cutting unnecessary expenses, investing, and increasing your amount is important. But it's not just about that.
Financial education involves financial and emotional factors, such as asking yourself whether the purchase or acquisition of a particular product or service is really necessary at the moment. Thus, you can better control your spending and plan your life with more tranquility.
It is important to keep in mind some questions, such as:
- Do I make purchases out of necessity or emotion?
- Can I control my money, or do I let it guide my choices?
- Do I have debts or are all my bills paid up to date?
These questions can be guides for you to start your financial education. Always remember that you should control your money, not the other way around. And knowing what to do with it is the next step.
Therefore, financial education is the act of being able to control money over time, improving your quality of life and being able to plan financially to achieve what you want.
The importance of financial education
It is very important to achieve financial independence. With financial independence it is possible to make plans, invest, and even fulfill that childhood dream. Therefore, understanding your needs, expenses, and how to deal with money is one of the steps to ensure more quality of life.
Educating yourself financially is part of planning your life. Having a healthy financial life is the main step to avoid getting into debt. And debts can cause several damages, not only financial, but also emotional.
In addition, many people associate the accumulation of money, wealth, with luck. But this is not always the case. Wealth can be the result of planning for someone who is well educated financially.
What you do with your money interferes with your ability to accumulate money
For example, every month you earn R$3,000.00 in salary. You use $1,800 to pay the bills. The rest you spend on outings, clothes, subscriptions and other purchases. The remaining $200 you leave in your checking account.
In this situation, you are not making the best financial choices. First, it is always necessary to evaluate if the expenses and purchases are really necessary for that moment. Of course, you can't tamper with bills such as rent and electricity bills. But is it necessary to buy clothes every month? You must always question your spending.
Besides, leaving the money that is left in the checking account is not to put it in investments that can make a profit. But, for this, it is necessary to study. This is why financial education is so important.
Thinking about the future
An important point of financial education is thinking about the future. Besides ensuring a more financially stable life in the present, it is the ability to anticipate the risks of the future. Thus, you are able to avoid the famous financial "hardships". It also ensures the ability to honor all your financial commitments, without giving up things that increase your quality of life.
