Financial education consists of the ability to correctly manage the money or income that is available, identifying better options to take out insurance, invest, save or acquire a loan.
Among its main benefits are the possibility of living without the stress of permanent debt or the worry of not making ends meet. Financial education is essential considering that it allows us to know the advantages and risks of money for the benefit of our financial and economic health.
A correct financial education is beneficial for the achievement of the following personal aspects:
- Create significant savings.
- Think of an economically stable retirement.
- Strategically manage contracted debts.
- Opt for more suitable financial products.
- Properly plan personal finances.
- Manage financing wisely.
- Improve Life Quality.
It is important to recognize the expenses that damage our finances, among them are:
Fixed expenses not established: They are the expenses that must be made in a mandatory way, many of them are of first necessity, in some cases they are excessively high in relation to the level of income.
Excessive Variable Expenses: They are not usually a fixed amount, they depend on the consumption of products or services that occur during the month.
Emergency expenses: are those that require a disbursement that was not foreseen in the month's budget, but must be made in the face of an unforeseen situation.
Ant expenses: They are those small expenses that are presented throughout the month without being contemplated, whose sum finally turns out to be higher than previously believed.
Flexible expenses: They are generally expenses that cannot be avoided, however, it is possible to set the amount that will be allocated.
The earlier we take care of our financial education, the easier it will be to make decisions related to money. It is important to recognize the importance of saving and manage personal finances with the aim of becoming financially responsible people in order to achieve well-being and financial balance.
ES