So what can be done to change this?
With financial education due to become part of the national curriculum in 2014, it appears that the importance of teaching youngsters financial skills has now been recognized. It is essential that our youngsters are equipped to manage their finances at a personal level. How else can we expect them to manage the wider economy in the future if they can’t manage their own money?
Money Management
Many people aren’t really aware of their lack of financial education until they start to encounter a problem. Having a level of debt is commonplace for many people, whether it is the outstanding amount owed on a mortgage, purchases put on a credit or store card or a student loan to cover college or university costs.
Debt has become the norm and is taken as a given. Without the necessary financial skills to budget and best manage debt, however, it can begin to build up, sometimes slowly and sometimes quickly, to a point where it becomes unmanageable, even if you have a steady income.
If you’re only making the minimum payment on your credit card, starting to get behind in paying your bills or have missed payments on a loan, then it is essential to take steps sooner rather than later. Pretending that you don’t have a problem or hoping that it will resolve itself are unlikely to be good long-term coping strategies.
For those struggling with debt, it is essential to learn good money-management skills. The essence of managing your money is being able to prepare a simple budget to understand how much you have coming in and how much you are spending. If your outgoings exceed your income, after you have cut out any unnecessary spending, you may need help.
It is important to recognize the signs that you getting into debt, as the earlier you take action the more options you have open to you. These can include repayment plans with your creditors, debt management plans that consolidate your debts and Individual Voluntary Arrangements, a formal legal procedure for clearing your debts.
The Bigger Picture
It is not just personal finances at stake but the wider economy. Whatever field of work you are in, the chances are that a level of financial decision making is required. Whether you want to work as an accountant, a retail buyer, in people management or become an entrepreneur, understanding the importance of budgeting and money management is necessary if you and the greater financial economy are to be successful.
AUTHOR BIO
CJ writes regularly about consumer finance for a range of websites and blogs. She is particularly interested in helping those struggling to manage their monthly budgets. For advice and help with debt management, companies like Consolidated Credit can help.
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