2. Values, Needs, and Wants
When it comes to finance, knowing the
difference between ones needs and wants
is key. Obviously when using money ones
needs need to come before his or her
wants. One should not spend money on a
new car if the one they currently drive is
working just fine. Needs are things like food
and shelter. Wants are things like the newest
technology or accessories.
3. Setting Financial Goals
Setting financial goals is very important. A
financial goal is an objective based on
money. A short term goal takes less than a
year to complete. A long term goal takes
more than a year to achieve. For example, I
made a short term financial goal a few
months ago to save $2,000 in 3 months. I am
proud to say I have reached and even
exceeded my goal.
4. Depository Institutions
Today, most people belong to some sort of
depository institution. There are banks and
there are credit unions. Both institutions offer
financial services and advice. There are
many important factors when picking a
depository institution. In my opinion
location, interest rates, and
insurance/security are the most important
factors.
5. Invest in Yourself/Lifelong
Employment
In order to make money, one must pick a
career. When starting a job there is a lot to
consider. One should make sure there is
opportunities for promotion in their career.
Another important factor is pay and
benefits. Clearly, ones salary is important,
but benefits such as health and dental
insurance are important to have.
6. Statement of financial Position
A statement of financial position shows a
families financial condition. The statement
considers ones assets and liabilities and
shows ones net worth. The statement of
financial position is very important. Having a
net gain means you are in a good financial
position. A net loss is not good it means you
are spending more than your making.
7. Credit Cards
A credit card is a plastic card for placing
credit. Credit cards are extremely useful
when handled correctly. Having a credit
card takes a lot of responsibility. It is
important to pay bills on time because
most cards have fees and charge interest.
Credit cards are good for buying large
items because one can make payments
overtime. It is also easier than carrying
around a lot of money.
8. Spending Plan
Similarly to a statement of financial position
one should make a spending plan. A
spending plan will help one to make smart
financial decisions. Sometimes people do
not realize how much things add up. It is
important to cut back on things like
entertainment and restaurant expenses in
order to save and spend money on more
important and necessary things.
