1. Introduction to Financial Education
This part of the site is focused on the theme "Financial Education". The Financial Education is not only to learn to save, cut spending, saving and accumulating money.
It is much more than that. It is seeking a better quality of life both today and in the future, providing material security necessary to enjoy the pleasures of life and at the same time obtain security for any unforeseen.
The famous fable of "Ant and the Cicada" a good example of an eternal question that we try to solve every day: "It will be better to just enjoy the day and prepare for the future"?
Translating this into a practical example, suppose you are walking in a mall and passed by a store with that fantastic outfit you always dreamed of. You do not have more money for the month. What do you do?
-purchasing clothes on the card 3 times, after all you deserve.
You never know what tomorrow but it will be better with this new outfit;
-do not buy now.
-But back home and start planning what to do to save money and buy it in 3 months.
-Do not buy at that time and even later.
-After all you have other more important objectives and priority that you want to accomplish
before purchase clothing.
Is there a correct answer? No. In fact, you can choose different answers according to the time of your life. The most important is that you choose your consciously answer, who knows the implications of their decision and have a balanced attitude.This is financial education.
It seems easy, but it is not. Our goal here is to help you get this balance in your financial life. Do not give up, but do not expect quick or miracle cures. Take a step every day. It may not look it, but in the long run you will be amazed at the results!
To facilitate the task of organizing your financial life, use the financial manager My savings, a spreadsheet full of spending, with apps for Android / iPhone and 100% free.
|Financial Education - Expenses Worksheet|
2. SETTING GOALS
The search for quality of life now and in the future involves setting goals that may have values and different terms. For some people, this process of goal setting is something that occurs naturally, without too much difficulty.
If this is not the case, do not worry. You are part of the majority! But this is no excuse for not having them. Your goal may be to make a trip next year, change cars in two years, buy a home in 10 years or just end this card debt by the end of the year.
You will probably find that have many goals for limited resources. The next step is then to prioritize goals, and finally, establish savings goals. And whenever you have to make a decision on "spend or not spend," think of your goal. Consider how your decision will cause you to get closer or further away from your goal.
To start a simple, establish at least ONE goal with regard to your money. Search a simple and short-term goal, so that you can see the results more easily and go gaining confidence in themselves. Soon you will already be seeking higher goals and long-term!
Financial education is an important tool for the realization of your dreams.
3. KNOWING AND CONTROLLING YOUR COSTS
Have you ever had that feeling that your salary just disappeared, but you do not know how? Well, people generally know how much they earn, but do not know how much they spend. And much less where they spend.
To change this situation it is necessary to make a control of expenses . This means daily note every expense made and what means of payment - cash, card or check.Expenditure shall be grouped into categories - education, food, housing, etc. - so you can perform a better analysis. Having done this, you can check the amount spent in each category and then establish a budget, a spending limit for each category.
If you notice that your expenses are higher than income, you have three options:
-and of course the best of the three, increase revenues together with the decrease in expenses.
Spending cuts are a painful thing to do. Means giving up, in many cases, those small pleasures that make life seem more worthwhile. However, this sacrifice today will be small compared to the joy of achieving their PURPOSE. This is the basis of the thought of Financial Education!
Some actions such as delaying the car's return, do not buy the latest electronic release, compare prices of goods and services before purchasing them can mean significant reductions in expenses. But also do not forget the small expenses that seem insignificant, like that daily candy after lunch or weekly lottery. Accumulated, they can become the villains of its budget.
Track your spending with care. You may notice that in some categories there are overspending. Or find out unnecessary expenditures that could be postponed.Believe. You will be amazed at the results!
4. MAKE MONEY WORK FOR YOU
The control and cut spending is not as pleasurable activity, but when performed with discipline it allows you to get a new employee, your own. That's right, your money now will work for you!
Having income over expenditure, the next step is to invest. The more you can save and invest, the faster you will achieve your goals. Of course, the more money you have to invest, the better. But another key factor that often do not take into account is the investment of time. It works as a springboard for your winnings. It's like if you won a prize for keeping their money invested longer.
To get an idea, investing $ 250 per month at an interest rate of 0.5% per month, it has been in five years about R $ 18 thousand. And in 10 years, this figure rises to just over US $ 42,000.
Now if you can save $ 600 per month, the amounts saved go up to R $ 43,000 in 5 years and almost R $ 102 thousand in 10 years!
See as the difference increases as time passes:
|Financial Education - Chart|
Of course, the sooner you start investing the better. But if you have not started, do not think that now it's too late. The truth is that it is never too early or too late to start, the most important is to invest regularly!
Another relevant factor is the rate of return on your investment. Obviously, the bigger the better. But remember that usually high returns can mean high risks. In the future, when you already have the basic knowledge of financial education, we will discuss the issue of return on investment in greater depth.
|Financial Education - Debt|
Having debt is not necessarily a bad thing, provided we have conditions to pay them. But for many, owning a home or an automobile is only possible through funding. What should we do when we need to borrow is searching for financing with lower interest rates and installments that do not jeopardize the family income.
For those who are not indebted and need to borrow money, it is necessary to know the debt capacity and for this you need a good financial control. This control should be able to point out the value of shares that can pay monthly.
It will be better if such control help cut unnecessary spending in order to provide extra money to pay off the debt as soon as possible.
In the case of those who already have debts, have a good financial control also makes things easier. With it's always possible to find sources of additional resources through non-essential spending cuts. This additional money can then be used to pay part of the debt, which will result in lower interest expenses and consequently more money in the future for other purposes.
And remember: it is essential that you manage your debts . And never let your debts will eventually control it! Another important lesson Financial Education!
For Financial Education, the concept of retirement is not that where we observe a worn elderly after years of work. Retirement can arrive much earlier. The scene I prefer to see is that of a person with a young spirit doing the things you really like, is enjoying the family, working on something that gives you pleasure or traveling the world. A person who has financial security and takes pleasure in living.
Many people believe that this is something too difficult to be achieved. Really, it's not something that is easy, but with discipline and making the right financial decisions, that is quite possible.
If you want to retire with only INSS resources or with resources of some pension fund, chances are you end up enjoying life just the end of it. For the idealized scene occurs you need to save additional funds beyond the "official".
This means that you should look for and always save as much as possible, taking into account the balance that must exist between the present quality of life and the future.
But only save not enough. Know investing is also critical to your goal. And this is not an easy task, as the options that are presented to us are many. They include not only private pension plans, but also any form of investment that will allow us to increase our heritage.
And what are the investment options should I choose? Well, the answer will depend on your risk profile, your discipline and also a good research. And of course, an analysis of these options.
Private pension plans have as main advantage the tax benefit. In the case of PGBL, can shoot up to 12% of the gross pay basis for calculating the income tax.
In addition, the income tax is only paid on the redemption or payment of benefits.Some plans have insurance embedded life and there is still the possibility to opt for regressive table of income tax rates.
As disadvantages, they charge a loading fee, plus the fund's management fee where the security feature is applied. This causes in some cases, pass the tax benefit to be lower than the plan's costs. Another issue is that private pension plans are generally designed to age at retirement "advanced".
What should be done is a combination of investments. The pension plan can guarantee you a quiet traditional retirement. But the retirement dreams must come from wealth accumulation to allow it to be independent.