Financial Education and Financial Intelligence

Financial Education and Financial Intelligence

Financial education is a central part of economic survival and progress of everyone. And is the initiation and continuation of sustainable economic mental development known as financial intelligence.

Unfortunately our society gives more importance to the production and excessive consumption of money that financial education and its outcome or skill in practice that is financial intelligence.

Handle or manage money properly is not an easy skill with so many temptations for bad debt, and we refer here to the concept of bad debt as a highly dangerous habit that many people have spending money they do not have, especially with the use of credit cards to purchase items or goods that do not make any return on investment and then end up paying them for a long time to other people or companies.

And often acquiring these articles without need them, simply for a craving or a caprice of the moment.

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Apart from this we must clearly state that the vast majority of adults and even professionals have little or no skills to successfully manage their personal finances because the middle or higher education, provides little practical utility financial tools for daily life , and for that reason we live in a culture dominated by economic uncontrolled spending and bad debt.

In percentage numbers exists according to the statistics 95 % of financial illiteracy in the world, which really indicates the degree of economic risk that so many persons and their debilitated finance have.

Although to enterprise level exists a much more rigorous control of the economic managing using for it countable tools as: General Balance sheet, Profit and Loss account P*G, Economic Indicators and Financial advanced Models, etc., for many common persons who do not know this type of resources not even exist a basic guide to construct a budget of expenses or a level of financial projections, instead the trend increasingly marked of replacing the daily managing of their money with emotions more than with the reason.

The managing of money is not also an internal simple process because it involves a mixture of emotions and reasons, which stimulated often for the advertising of aggressive consumption of the mass media, the desires and the privations to want to have something when still the personal economy does not allow it, finish for inclining the scale towards the emotions and the pleasure of the moment, buying compulsive and generating a serious economic reverse that often costs money fully in the future.

To some extent to have a comfortable and peaceful financial life should be a balance between economic output and spending. But much more inclined to the production and to the suitable economic administration, since the money represents a finite resource of the human being who is the time, which it does not recover and it avails nothing to spend equal money to what is gained or worse still to spend much more than it is gained.

One of the most frequent financial mistakes of the persons with small or no financial education is to think that because enough money is gained wealth is constructed, when it can be the opposite, due to the fact that if a person who wins very much, spends equally or more than it wins and does not preserves, invests and multiplies his money, he is really in way towards the bankruptcy and the poverty that towards the wealth.

The financial intelligence for its part is the skill to do more money with minor resources and to solve economic basic or important problems of the own economy with major profit that loss. And this one is the distinctive feature of every successful entrepreneur, who across the training and the action takes advantage of the economic and technical limited resources that he has to construct an innovative and successful company.

Nevertheless as we said previously the financial intelligence it develops by means of financial education and the experience by mean of the action.

Now then, though the Financial Education constitutes a tool that accelerates with much the process of learning and of development of the financial intelligence, the practice of this theoretical knowledge and the wisdom of the mistakes that are committed in the process to direct successfully the personal finance, are those who definitively allow to live through an economic peaceful and prosperous life.

It is common in many homes the problems of lack of money, which are mainly due to two distinct reasons:

1. Lack of Financial Education: what makes that there is poor money management by parents or household heads and clearly there is also a low level of financial intelligence.

2. Lack of Financial Intelligence: what makes so many people do not try anything new out of what they have always done for a living for extra income either to help with personal expenses and / or family. This is especially due to fear of failure and resistance to change.

As for the present time where the world’s economies have so many changes due to multiple internal and external factors is urgent to educate and teach the new generations a proper money management not only to survive in a changing world, but to identify opportunities that come with change and economic crisis because economic capital is not just change of hands but for those who can assimilate and manage it.

According to Robert Kiyosaki the great guru of the practical finances“money problems are not solved with money, but with education and Financial Intelligence joined”.

And the Financial Education according to him is also a great support to learn to invest and not to trust of good to first in the obsolete advices that many financial worried experts which are more interested in obtaining their commissions recommend like: to work very hardly, to save, to pay good debts that are those that other persons pay for one, diversify in the same portfolio of investment thing that does not reduce the risk, etc.

In our experience as consultants for companies and individuals, we highly recommend to invest widely and to get up-to-date in courses of Financial Practical Education to take effective control of the economic present and future, that are available today in online resources, and attend at least one to twice a year in investment seminars on topics such as real estate, stock market assets, commodities, futures, forex, etc..

Then let us summarize the benefits it will brings an adequate Financial Education:

  • To develope a proper mindset towards money: for knowing what blockages you can have to progress and prosper financially reprograming your mind with new concepts that allow you to believe in yourself and overcome mental barriers to success.
  • To handle intelligently the personal finances : by mean of the theoretical countable and financial tools to organize personal and familiar income and expenditures as a whole company.
  • Use the power of investment and its different classes: to leverage and multiply money by making this work in your favor rather than against, as when you are full of bad debts.
  • Generate multiple sources of income: increasing the financial intelligence to look for new sources of income: mlm, online businesses, exemptions, etc., and not to remain paralyzed by obtaining the same and scanty economic results doing what always has been done.
  • Take control of the present and the economic future: that is so necessary for millions of people find financial independence and not continue at the mercy of financial ignorance being so often exploited and undervalued in their jobs and having to conform with a standard of living below his economic expectations.
  • Eliminate the resistance to change and the dread of trying new economic options: instead developing a mentality of advance and adaptability opposite to the economic crises and adverse situations in the economic plane to obtain the maximum profit of every problem that comes and to turn it into opportunity.

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