Dear reader,
One of the topics I will discus in my blog is finance.
To get a good understanding of how finance and money works you need some form of financial education. Unfortunately financial education is not taught in our school system. So to gain financial education you need to learn it for yourself.
My journey with financial education started about 2,5 years ago. I heard about the book Rich Dad, Poor Dad, by Robert Kiyosaki. He is a great investor in real estate and gold and silver. In his book he takes you a long his journey how he learned about money and became one of the worlds bestselling authors in personal finance.
Why financial education?:
Financial education is very important. If you want to learn how to manage you finances, investments and your financial life you need to have some education about how it works. For example: you need to know what a balance sheet is and how it works. You need to be able to understand the difference between an asset and a liability. Once you got a good understanding of these financial terms you will be better at making your own financial statements.
Financial education is also very important if you want to understand your cashflow. If by week three you don't have any money in your account then you might want to consider reading a little bit about financial education. This will help you track your expenses, save for the future and maybe even let you do some investing.
How to track your financial plan?:
Everyone has a different financial plan. This depends on you age, your financial goals and how well you can keep track of your money. Personal finance is very important. On a regular basis you need to make sure you are on your financial track. Are you saving as much as you want? Are you expenses exceeding your income? What if you have an emergency, can you come up with $1000,- at an instant. These are some of the most important questions to ask your self.
First you need to know what your income is. Is it the same amount each month or does it change? What are you fixed expense? (Rent, phone bill, insurance, ect..) These are the expenses that you have no matter what. They are the same price each month and they get deduced every month.
Then you need to know what are variables? How much do you pay for food each month, for drinks at the bar or on clothes? This is the area where you often loose track because $10,- here and $30,- there often makes you loose sight of what you actually spend.
How to build a stable financial plan?:
Once you figured out you income and expenses you can start building you financial plan. You need to set out financial goals. Maybe you want to save $1000,- by the end of the year or you want to take the trip you always dreamed of. Then you need to make your financial goals very clear.
An easy way to this is by setting up an automated deduction from your bank account to your savings account. This will help you not forget to put the money in your savings and over time you will see that the amount has grown exponentially. You can also use weekly budgets. This allows you to use and spend $100,- a week. Any money you have left either goes to your savings or you put it in a jar that you can't open.
Tips and tricks:
- Remember to check on your financial plan a few times a year to see if you are still on track or if some changes need to be made. Would you like some personal tips and tricks? Leave a comment and I'll get back to you!
Thank you for reading, in an upcoming blog I will go deeper in financial education and making a financial plan. I will show you my plan and how I keep track of it. It doesn't work right a way so it is okay to fix and change it while you go.
Franklin, Moments2Success
One of the topics I will discus in my blog is finance.
To get a good understanding of how finance and money works you need some form of financial education. Unfortunately financial education is not taught in our school system. So to gain financial education you need to learn it for yourself.
My journey with financial education started about 2,5 years ago. I heard about the book Rich Dad, Poor Dad, by Robert Kiyosaki. He is a great investor in real estate and gold and silver. In his book he takes you a long his journey how he learned about money and became one of the worlds bestselling authors in personal finance.
Why financial education?:
Financial education is very important. If you want to learn how to manage you finances, investments and your financial life you need to have some education about how it works. For example: you need to know what a balance sheet is and how it works. You need to be able to understand the difference between an asset and a liability. Once you got a good understanding of these financial terms you will be better at making your own financial statements.
How to track your financial plan?:
Everyone has a different financial plan. This depends on you age, your financial goals and how well you can keep track of your money. Personal finance is very important. On a regular basis you need to make sure you are on your financial track. Are you saving as much as you want? Are you expenses exceeding your income? What if you have an emergency, can you come up with $1000,- at an instant. These are some of the most important questions to ask your self.
First you need to know what your income is. Is it the same amount each month or does it change? What are you fixed expense? (Rent, phone bill, insurance, ect..) These are the expenses that you have no matter what. They are the same price each month and they get deduced every month.
Then you need to know what are variables? How much do you pay for food each month, for drinks at the bar or on clothes? This is the area where you often loose track because $10,- here and $30,- there often makes you loose sight of what you actually spend.
How to build a stable financial plan?:
Once you figured out you income and expenses you can start building you financial plan. You need to set out financial goals. Maybe you want to save $1000,- by the end of the year or you want to take the trip you always dreamed of. Then you need to make your financial goals very clear.
An easy way to this is by setting up an automated deduction from your bank account to your savings account. This will help you not forget to put the money in your savings and over time you will see that the amount has grown exponentially. You can also use weekly budgets. This allows you to use and spend $100,- a week. Any money you have left either goes to your savings or you put it in a jar that you can't open.
Tips and tricks:
- Remember to check on your financial plan a few times a year to see if you are still on track or if some changes need to be made. Would you like some personal tips and tricks? Leave a comment and I'll get back to you!
Thank you for reading, in an upcoming blog I will go deeper in financial education and making a financial plan. I will show you my plan and how I keep track of it. It doesn't work right a way so it is okay to fix and change it while you go.
Franklin, Moments2Success
Comments
Post a Comment