Most of us are not doctors but know what to do to take care of our health. We get this knowledge from our parents, peers, our regular reading, TV etc…. We try as far as possible to follow the advice on balanced diet, Exercise, rest, and minimize/ eliminate bad habits like smoking and drinking.
I would like to think of “financial education” in the same way. We all need money to ensure a good life and we need to take care of it. You don’t have to be a mathematics or financial genius to understand this. Here are my basics:
1. Live within your means. Ensure you can pay for what you buy.
2. If you borrow money ensure you can pay the EMI. Check to see if you can still pay for it if interest rates were to rise/ you were to lose your job.
3. Protect what you have. Insure your life, Health and assets. You wouldn’t leave your house unprotected, don’t do it with your life or health.
4. Plan your future expenses like child education, buying a home, Retirement etc….. See how much you need and save accordingly. There are plenty to tools that will give a good estimate of what you need.
For More: Why Financial Education?