Do You Know How to Manage Your Money?

 

It’s said that we never stop learning. As we age, we gain new access to information and change our behaviours based on the new data we have collected. Financial skills are one of the vital areas that need to be explored and are something we can never really stop using.

Unfortunately, many of us never learn these skills and we are constantly confronted with outside forces compelling us to spend more.

Debt is now a constant presence in our society, but it must be remembered that there is a difference between good debt and bad debt. Knowing how to manage your money so you have limited amounts of bad debt is important and is one of the things that will lower your stress levels.

The question then becomes: How do we learn this?

Finances can be stressful, but your relationship to money will be much less overwhelming if you are introduced to it early and taught about its value.

Previously we’ve looked at debit cards created for the youth audience (Dojo, Osper and Pennybox, for example) and discussed how these new innovations can help parents introduce young people to the concept of money. One of the major issues though becomes how much control you give your children when it comes to how they use that money.

Some startups have seen this issue and have created solutions that help address this problem.

Greenlight, for example, lets you divide your child’s spendable money into two sections, one (Spend Anywhere) they can use as they choose and one they can only use at approved stores. By giving them freedom while also maintaining a sense of parental oversight, children can learn about spending limitations and how they should budget and manage their finances. This is probably one of the most important skills you can teach them.

It’s important to teach our children financial skills, but we need retraining too. Today’s North Americans are not saving as much as they should and, according to a study done by FINRA, nearly two-thirds are unable to pass a basic financial literacy test.

The sad reality is that many people are living paycheck to paycheck today, desperately trying to scrape by as costs increase while wages remain stagnant. If they do manage to explore a savings account, they are presented with tiny interest rates from the major banking institutions, making the process appear fruitless.

For people who want to create a nest egg, this process can be very disheartening and, if unaware of other options, they may never really be able to achieve a sense of stability.

Thanks to FinTech, the tide is turning and new options are coming up for people who want to cultivate their savings.

Startups like Beam are offering their services so people wanting to start their savings can now grow nest eggs much faster (while paying less in bank fees), getting way more value for their money. Plus, the easy online access means you can access your account at a time that suits your schedule.

Knowing you have a savings for your future or for emergencies will make so many aspects of your life easier, and this is definitely a financial area everyone should be exploring.

Perhaps the most important step we will take to ensure financial security and success is to understand blockchain. After all, having a firm grasp of its reality and potential can help us better use the new technological advancements as they come to market.

This innovative technology will keep our encrypted data secure and make our financial transactions quick and easy and is a large part of the financial metamorphosis we are currently in.

Blockchain will be one of the driving forces in tomorrow’s economy, as the potential for the technology extends far beyond just finance.

Educational institutions are recognizing how important this technology is and are starting to offer courses to educate today’s and tomorrow’s financial business workers in everything blockchain. York University, for example, has the Blockchain Hub, a centre to help foster innovation and support entrepreneurs. There is even a Blockchain University where students can learn from the leading experts in the field.

Tomorrow’s business world will be led by visionaries who know how to work with blockchain and will use this knowledge to make our world better.

Maximilien Robespierre once said that, “The secret of freedom lies in educating people, whereas the secret of tyranny is in keeping them ignorant.”

By keeping people financially unaware, the 1% have been quite successful at maintaining a banking system that benefits the wealthiest while keeping a large percentage of the population living on meager rations.

We are starting to wake up and realize the system needs changing and FinTech is how we are fixing our financial ills. Along with the right education and training, we will finally become masters of finance.