Financial Literacy - Six New Ways Of Thinking That Will Change Your Financial Future!

April is Financial Literacy Youth Month in the Bahamas thanks to the tireless efforts

of my friend Keshelle Kerr of Creative Wealth Bahamas and her passion for empowering the next generation of Bahamian financially.

But what is Financial literacy and why is it important to you?

Simply put Financial literacy is the ability to understand and make informed and effective decisions about the use and management of your money.

And while money is an important part of your everyday life, you will agree that few subjects are as intimidating or frustrating for you as money.

And while you are expected to make informed and effective decisions about the use and management of your money. You are challenged by the fact that you have not been taught how to manage your money effectively.

It's not surprising then, that your money worries maybe one of the biggest causes of stress in your life. And why improving your financial literacy may be the best decision you can make.

While you may have bought into the notion that all you need for financial success is to get a job and work hard by now you have realized that this is not the case.

The fact is working hard is WORTHLESS - unless you know how to manage your hard earned money!

The truth is no matter how much time, effort and dedication you invest in your career, you will never achieve the success you deserve unless you know how to take control of your money!

As you live in a society that makes you ultimately responsible for your financial future and the result you get from your money, here are six ways of thinking that you can use to improve your own money making decisions.

Think Wealth Creation. And the definition of wealth is simply how long can you go without a pay cheque. This should be the foundation of your financial planing as you will only earn a fixed number of pay cheques during your working years.

Think Debt Free. You can not create wealth if your money is being consumed by debt. Therefore, you must evaluate every offer of credit critically. While credit provides the immediate gratification that we all desire it robs you of the opportunity to create real sustainable wealth. And once you allow

yourself to get into debt it is usually difficult to get out.

Think Net Worth. By focusing on your net worth you will ensure that you maintain the appropriate ratios between your debt and assets. As your net worth is the best indicator of what you actually own.

Think Financial Education. The best way to improve your financial literacy is learn as much as you can about money and how it works. Commit to reading at least one book or magazine on money and investing each month. Taking Control of Your Money Workbook is good resource to help you get started. And there are lots of free resources available at on the internet.

Think Simplicity. One of the biggest challenges you will have is distinguishing between your wants and needs. So once you learn how to distinguish between what you want and need you will immediately reduce your spending by at least 38 percent. As most person spend 38 percent of their money on things they dont really need.

Think Financial Goals. Setting financial goals may seem elementary but setting financial goals is the key to bringing discipline to your money management. And while it is important to live for today you must also plan for tomorrow.

Finally, you do not have to be rich to be financially stable all you have to do is change your thinking about how you are managing the money that you do have.

by: Glenn S. Ferguson

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