How to Get a Financial Education on the Cheap

Where did you learn most of what you know about finance, money and investing? Since financial literacy is barely taught in most public schools, many people learn about money from their parents, friends or coworkers. But very often the people who teach know very little themselves.

It is important to understand why financial literacy is so important and find reputable and cheap sources to get a financial education.

Why Do You Need to Be Financially Literate?

We deal with money on a daily basis. We work most of our lives earning and saving it so we can someday retire and live off our passive income. But money can work against you just as easily as it can work for you.

Understanding basic financial concepts such as budgeting, living below your means, saving for emergencies and large upcoming expenses, investing and planning for retirement is very important if you want to be financially successful. Once you learn how money works, you will be able to make it work for you, increase your wealth, retire earlier and create a better life for you and your family.

Getting a Cheap Financial Education

Contrary to what you may think, you don’t need to go to an expensive college or university, attend seminars or buy overpriced training programs to learn how to better manage your money and make smarter financial decisions.

Here is what you can do to learn more about personal finance and investing without spending much or any money at all:

  • Read books. Books are an outstanding source of knowledge on any subject, including finance. They usually offer a comprehensive account of a particular topic from start to finish. There is a book on virtually every financial subject.
  • Follow finance blogs. Blogs are very unique sources of financial education, since they offer financial advice from real people with real problems and real solutions. The authors may not be professional financial advisors (although some are), but share how regular people deal with money problems.
  • Watch money-related TV channels. Watching CNBC or Bloomberg TV is probably not your favorite pastime, but there are tons of great television programs that can teach you about many different financial topics, from making your first budget to creating a diversified retirement portfolio.
  • Attend free classes. Many colleges and universities offer free financial classes on a one-time or regular basis. These classes vary in their content and length, but can nevertheless be very helpful. Check with your local schools, colleges or universities to see if there are any that are coming up in your area.

You should never stop learning about finance, as well as all other areas of life. Education opens new doors, possibilities and opportunities. And since most of the above methods are very cheap or free, you have nothing to lose!

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Financial Literacy – A Tool For Wealth Creation

In a few words, “financial literacy” means being knowledgeable about financial matters. Everyday of our lives we deal with money. We make money and we spend it. Financial literacy encompasses making and spending money. Making money and spending it are two different things. This article is concerned towards spending money rightly. Next edition will delve more into making money.

Let me ask a question. Which one is more difficult: making money or spending money? I know you might say making money. If you say making money and spending it any how, you are right but making money and spending it rightly you are wrong. Because of lack of financial knowledge most monies people make are lost or wasted. If you do an investigation on people’s finances you will find out that majority of what people earn goes into expenses. That means that people’s incomes don’t get multiplied (invested).Let me give a simple illustration, suppose you earn N5M annually and at the end of the year you find out you spent the income on: gas, rent, clothing, fuel, etc. All these are expenses and they don’t add towards assets acquisition. The best way to manage your expenses or keep it low is to have a budget. A budget tells you what to spend on and how much to spend; it is a financial guide. Once you have a budget you guard against impulse buying.

In a simple definition assets can be said to be something of monetary value. In Accounting parlance there are two types: Fixed assets and Current assets. In wealth creation parlance there are two types of assets, depreciating assets and Non-Depreciating assets. Non-Depreciating Assets are assets that increase in value. Depreciating assets are assets that decrease in value due to wear and tear or decay. Examples are motor vehicles, furniture, household equipments, clothing, etc. These are items we need for our daily upkeep. These items have various rates of depreciation. From the pack, clothing has the highest rate of depreciation. The clothe you buy today might depreciate up to 70% in the next six months. Household equipment has an average rate of depreciation. Motor Vehicles have a fair rate of depreciation. The mistake most middle-class people do is that they invest a lot of their monies in depreciating assets. Before I continue let me define middle class in Nigerian context. A middle-class woman is one who earns about N2M to about N10M annually. The normal middle-class woman spends money on designer perfumes, designer clothes, sophisticated handsets, jewelleries, etc. These are depreciating assets and their disposal value is low. The plight of the middle-class woman was made worse during the recent banks crisis which was caused by banks CEO’s wasteful and fraudulent practices over the years. Most women left their various bank still owing because they were living on loans. To worsen the matter some of them used their loans for frivolous things. Those that even invested never invested on Non-depreciating assets. At the present most of them are licking their lips over their mistakes. If only they were financially literate they could have been wiser.

The assets that actually make you rich are Non-depreciating assets. Assets like Land, Houses, precious stones, antiques, shares, art work, bonds, etc. The land you buy today might appreciate 300% depending on the town and area. Take Abuja for instance, those who bought land in the nineties had about 1000% return in investment about ten years after. Currently in Abuja places like Kubwa, Mararaba, Karshi, Gwagwalada, Nyanya, Karu, etc are investors delight because of its affordability. Lagos has a sprawling real estate business. Workers are patronizing these real estate firms that sell lands in estates in places like: Awoyaya, Lekki, Ajah, Sango Otta, Mowe, Alagbado, Agbara etc. The beauty of their deals is that they allow installment payments. A plot of land in Alagbado, Agbara, Sango Otta and Mowe goes for about N500,000 upwards. Some of them give a grace of up to four years to pay up. Another interesting thing about them is that these estates have nice neighborhoods and facilities. Some of the facilities you may enjoy while staying in these estates are: Global C of O, Perimeter Fencing with Gate, Shopping Malls, CCTV, Banking Facilities, Street Light on all Roads, Waste Disposal System, International Schools (Nursery, Primary and Secondary), etc.

The importance of acquisition of shares cannot be over emphasized. There are two ways you can buy shares: Public Offer or through Stock Brokers. Over the years shares acquisition has been beneficial to Nigerians. The beauty about shares is that the gains are plethora. After every end of an accounting year of any company you invest in; if they make profit you are likely to get dividends. You might also get bonus shares after the end of the accounting year. Trading of shares is also a means of making money if the price appreciates. Recently share prices dropped globally signaling world wide recession. In Nigeria people lost money in the stock market because of the crash in price. Most recently the All Share Index of the Nigerian Stock Market has increased signaling an improvement in the Stock Market. It is advisable to invest in the Stock Market now, either for the future or for trading.

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Financial Literacy 101

It doesn’t take a genius to understand money. Money is nothing more than a tool, no different than a hammer and nail, or even a computer. It is a means to an end and should never be feared. Money is misunderstood by too many people and rather than being able to harness its power, they end up being enslaved by it. Financial literacy is paramount, especially in today’s economy, which is in tatters. It is terribly unfortunate that this subject is not given much attention in schools, for it is the most important one that impacts all of our lives every single day. For those who want to take control of their finances and break free of the stranglehold that our economic system has on us, the following will help steer you in the right direction:

Get your money to work for you rather than you working for it. The majority of the population is trapped in the vicious cycle of working themselves to death but staying barely ahead of their expenses, if even that. We are plagued by this debt-ridden society created and controlled by ”The Money Masters” of the International Banking Elite. The good news is, there are numerous ways of using this venomous system to your advantage and fairing well. What you need to do is implement strategies that offer you a return on your money with the least effort required. A combination of living within your means (NOT ON CREDIT!) and a solid investment plan in ASSETS will help you break free.

Assets are things you own whereas liabilities are what you owe. Good assets can generate income such as rental properties, rent to own homes, certain businesses, tax lien certificates, precious metals etc… We often think that a house and a car are assets, but financial experts always classify them as liabilities, since they have to be paid every month and don’t normally generate cash-flow on their own. Devote your time to money-generating assets which will be the foundation of your diversified investment portfolio.

Starting your own business is a great way to build lasting wealth. That’s not to say it won’t take a tremendous amount of work, dedication, and sacrifice, so never fall for hype and get rich quick scams because they never work. What does work is having a solid product or service to market whether it be yours or someone else’s and implementing a solid marketing plan. Working for yourself with very little overhead is ideal. Do your research and never gamble.

Your goal is to be a wise entrepreneur, and investor. The average small business takes anywhere from 3-10 years to turn a significant profit from which you will be able to live from so don’t quit your day job! Use your income from your job to acquire assets and grow your enterprise. The great thing about owning your business is that while you are building it (and not yet seeing a profit) you can still take advantage of numerous business-related tax deductions based on things you spend money on anyway such as: mortgage/rent, hydro, heat, home and car insurance, property/school taxes, condo fees, interest on certain loans, phone, internet, gas, car maintenance, restaurant bills, office supplies, furniture, and more. Saving money is just as good as making it!

The problem with people who struggle to grow their money is that they keep on working for somebody else and don’t maximize the earning potential of their money by acquiring the proper assets. Many also don’t start their own small/home business on the side and end up paying a good portion of their yearly salaries away in income tax. Lastly, too many live beyond their means. Exercise restraint and keep things simple and manageable! The majority of hard-working people are toiling away for others and not for themselves. And after all that, they face the terrible realization that they do not have much, or anything at all in some cases to show for all those years.

The solution is to invest in yourself. It just makes sense. Use the rat race, banking, and taxation systems to your advantage. Build your business, and invest in things that will generate cash flow for years to come while putting the least amount you can out of your own pocket. Leverage other people’s money and expertise (banks, renters, other investors, financial advisors, etc…) to grow your portfolio and you will be financially free much sooner than you think. Financial freedom will bring something far greater, personal freedom!

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Emotional Literacy of the Heart

“The moment a little boy is concerned with which is a Jay and which is a Sparrow, he can no longer see the birds or hear them sing.” Eric Berne

Emotional Literacy is a serious concern today. Being able to recognize, understand and effectively express emotions are a responsible part of learning life skills. Like we learn to manage relationships, work, finances, physical health and spiritual growth, human emotion is just as relevant. Understanding emotions are vital and can overwhelm to comfort us at various times in either a negative or in a positive way.

Emotional health is a critical part of everyone’s well-being. Knowing our emotions are key to success in life. If we want to make a life filled with wholesome well-being, joyousness and peace – at any age it is important to know them, and to know how to manage them.

Research proves many concerns of modern society may result in people being unable to understand and appropriately express emotion. The freedom that comes from being emotionally literate is being able to own it.

The technological world has grown exponentially and moving at a speed greater than ever been seen before in human history. Emotional literacy is just as excruciatingly a vital preventive tool. And when well understood, it can solve various social ills from violence, abuse, illness, dysfunctional relationships, and societal conflicts.

Since the 1960s, a world of experts have exploded with curiosity in forming opinions to suggested disciplines and modalities around emotional intelligence.

Emotional literacy expert, Claude Steiner, PhD in his book “Emotional Literacy; Intelligence with a Heart,” says if you practice the three emotional strategies discussed in his book-opening the heart, surveying the emotional landscape, and taking responsibility-you will see dramatic changes in your emotional awareness, attitude, and in particular, Steiner states you will learn:

  • How to know what you want and what you feel; how to be truthful about your emotions; how to pursue fulfillment of your emotional needs.
  • How to manage your emotions creatively; when to hold back and when to express your feelings.
  • How to deal with emotional numbness or turmoil.
  • How to apply your knowledge of emotions at work, at home, in school, in social groups, and “on the street” to improve and deepen your relationships and forge long-lasting, honest connections with people.
  • How to practice a love-centered approach to personal power in a society that is moving in the direction of mistrust, loneliness, anxiety, and depression.

We’ve come a long way from IQ being the only standard form for determining human excellence!

Steiner professes he is not an intellectual expert. And, he shares how Research leads us into the wrong direction to prove happiness doesn’t just come from having a high IQ. For example, what he says is if we have a high IQ (intelligence quotient), it’s more likely we will do well in school and become productive, successful, and a good learner. Not only that, he claims, with a high IQ, we are told we’ll probably have a long life and good health.

In spite of the resistance shown in some of the world’s largest corporations, employers continue to battle it out to hire people with the highest IQ. However, Emotional Intelligence is ringing louder and louder at the boardroom tables forcing an arena of intelligentsia to listen up!

Emotional Intelligence, such as optimism, working with others, and empathy or compassion, are on the top 10 for ‘will hire,’ by employers today.

For the inquiring intellects, you’ll discover Emotional Intelligence borrows from other areas of behavioural, emotional and communications theories from Albert Ellis to Alfred Adler.

Steiner’s mentor is Eric Berne, Canadian-born psychiatrist known as creator of Transactional Analysis, and author of Games People Play. Berne brought us the concept of ego states to explain how humans are and how we relate to others and ways we think, feel and behave – derived from our states: “PAC: parent, adult, and child.”

Steiner welcomes Daniel Goleman and his insight on Emotional Intelligence to prove having emotional awareness is as key to success as a high IQ. Not only that, he shows that you need emotional intelligence to live a “good life”-one that allows you to enjoy the riches of the spirit. To live well, he says, you need not only a high IQ but a high EQ (emotional quotient).

Some of us were taught as a child that talking about feelings or emotions were a sign of weakness. What are you feeling and what does that mean? We learn to turn feelings off, and why? “Buck up, boys and girls don’t cry, toughen up – ah stop being a sissy.” Do any of these remind you of what is whirling around in your head?

We cannot have EQ or Emotional literacy if we don’t know how we feel, think and behave – our thoughts will drive our actions and our behaviours. Good emotional health is being aware of emotions, thoughts, feelings and behaviors, all part of working at keeping levels of stress in check. (APA).

Take this EMOTIONAL AWARENESS QUIZ:

Please answer the questions either yes or no truthfully.

1. Do you do any of these in excess e.g. drink, gamble, smoke, exercise, eat, have sex or engage in recreational drugs? – Yes or No?

2. Do you isolate yourself or feel like you do not belong or disconnected from others? – Yes or No?

3. Do you feel sad all of the time and don’t know why? – Yes or No?

4. Do you get easily angry, impatient, intolerant or find yourself bullying others? – Yes or No?

5. Do find yourself catching up on years of crying over a loss – any loss? – Yes or No?

6. Do you walk around unaware of how to get beyond what the emotions inside of you are telling you? – Yes or No?

7. Do you think it is better to suppress, hold back emotions because it shows as a sign of weakness? – Yes or No?

8. Do you know how to name your emotions to help you better manage and control them? – Yes or No?

9. Do you know too little about your emotions, as something is bothering you yet don’t know what to do? Yes or No?

10. Do you act happy all of the time when you are anxious, scared, lonely, discouraged? – Yes or No?

RESULTS: If you answer yes to 3 or more of these questions and no to all of the others, it is likely you are unaware of emotions. These emotions that are not brought forth from the inside out likely hold you back. Withheld emotions can impede health, and can hinder you from receiving the fulfillment you need to reach your goals and enjoy life to its utmost.

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