According to The World Bank, financial capability is “the internal capacity to act in one’s best financial interest, given socioeconomic and environmental conditions. It encompasses the knowledge (literacy), attitudes, skills, and behavior of consumers with respect to understanding, selecting and using financial services, and the ability to access financial services that fit their needs”. (The World Bank, 2013, page 1)
From the definition, it is assumed that financial management is a kind of skill that everyone has the potential to have it. However not everyone can use the money wisely, and many of them are extravagant. Having money will give someone the opportunity to make decisions, whether they are old or young. You as a child who are still funded by the parents should appreciate how the efforts of parents to get money to meet all your needs, including your education. Many people take no care of their money till they come nearly to the end of it, and others do just the same with their time (Johann Wolfgang Von Goethe, 1749).
What does it mean? To me, this quote talks about preparation, planning, and foresight. If you have a plan to buy something important and expensive you . If you had been doing any preparation, planning, or had any foresight, you should prepare with saving money routine until you buy the thing that you have planned in the beginning.The second part of the quote cautions us that as bad as the consequences of this behavior is with respect to our money, it is even worse if we do it with our time. Waiting until we are nearly out of anything isn’t bright, nor is it wise.
Usually, when moving from high school to college, many of you receive monthly or weekly money. When you meet a situation like this, you are required to be skilled in managing revenue and expenditure. Do not spend too much. Many of you might have run out of monthly or weekly money when the end of the month is still far away. Obviously it will impact on your activities in the future where you can’t meet your needs such as food. If you are in this condition, in order to survive, you can only call parents to earn extra pocket money. It will troublesome your parents.
The Problem often faced by college students and other teenagers because they usually spend their money for some personal stuff like magazine, entertainment, gadget. Young people also liked to spend their money for a temporary pleasures like watching movies in cinema, food shopping, karaoke and others. Do you know how to overcome this problem? Here are some methods or tips that you can use to spend your money wisely.
First, you must come with a budget. Yogin Patel in Lauren, “The biggest thing I've learned is to have a budget for practically everything”. That means dedicate funds every month towards eating out, going to the movies, late-night snacks, books and supplies, socializing, etc. Keep in mind these budgets should let you save a portion of money every month, that’s one of the keys.
You need to track all you’re spending for a few months so that you can work on your budget knowing where your money is going. you need to make a list of your monthly expenses for example using your bills and the information you gather. Review this list to determine where you can reduce expenses. Besides that, you should avoid impulse buying so that you can avoid from purchase wasteful items.
Second method is how you spend money on your clothing. People these days like to spend their money on buying expensive clothes that have style and name brand like Edwin, Salt n Pepper, H&M, Calvin Klein, Alain Delon and many more. What you need to do is figured out what you need, the importance of the item to have. For example, it is unwise to spend too much money on socks because it will be worn out very quickly. Buy five hundred thousand rupiah jeans that last for 6 years is worth than buying two hundred thousand rupiah jeans that only last for 1 year.
Third, is how you spend your money on food and beverages? What you need to do is you should make a shopping list of healthy foods that your body need and avoid adding sweet and snacks in your list because it’s not good for your body. Besides that, you should avoid from eating outside because of the higher price. Best way to avoid, is start packing lunch or dinner to work. Cooking at home doesn’t mean you can never eat out. Cooking at home can be fun, inventive and even a great social activity. While it may require some planning ahead, a lot of money can be saved by purchasing ingredients from your local super market and making the most of leftovers.
Learning how to save money is an important preparation for your financial future. While saving money may not seem to be an easy thing to do, establishing short term goals as well as long term ones makes the results seem more achievable. Establishing a savings routine takes determination and dedication, but may be accomplished in part by changing daily routines.
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