Your finance is the most important part of your business. No business can thrive without money. This is why financial literacy is very crucial to you and your brand.
That’s why we interviewed a writer at GreenSprout, a blog for financial development, on the five smart moves to impact your financial future. The details of the interview are below;
WHAT CAN YOU TELL US ABOUT FINANCIAL LITERACY?
Financial literacy is the possession of the necessary knowledge and skills to allow you to make effective and informed decisions with your financial resources.
Understanding concepts such as savings, investments, debt, etc., drives you to a sense of self-trust and financial well-being.
WHY DO YOU THINK FINANCIAL LITERACY IS IMPORTANT?
Many people struggle with saving and investing due to a lack of financial understanding. Financial literacy is important because of the many financial decisions you have to make for your personal life and your business.
Low financial literacy will leave you unprepared for a financial crisis. Hence, you need to be financially literate to make informed decisions.
Generally, financial literacy guides you to make better financial decisions. It also guides you in creating an effective budget, empowers you to manage your money and debt, and equips you to attain your financial goals.
To truly impact your financial future, you must become and stay financially literate.
WHAT ARE THE 5 SMART MOVES TO IMPACT YOUR FINANCIAL FUTURE?
First, you must know what and where you spend. Once you do, it is time for step two.
Since you know where your money goes, you can create a budget to decide how much you are allowed to spend on each expenditure. Instead of completely cutting out some things, you can create a realistic budget that works with your spending habits. That’s what we advise at GreenSprout.
Thirdly, you must pay your bills when due to increasing your credit score and interest rates. Next, you must have emergency funds saved up for rainy days. These are days when you are not so solid financially. Instead of borrowing money or simply lagging on bills, you can dip into these emergency funds.
Lastly, you can gradually contribute to your investment accounts even if your investment capability is currently limited. This will help you to develop multiple streams of income.
WHAT DO YOU HAVE TO SAY ABOUT LOANS?
Loans can be great if you have a structured plan to pay them back.
Loans help your business to grow. You can take loans to start up or expand. Either way, you do not have to wait until you have saved enough to start or expand your business.
The most important things to note when taking loans are; Have a goal for the business loan, only borrow what you need, have a repayment plan, and keep your business and personal finances separate.
DO YOU HAVE ANY FINAL WORDS YOU’D LIKE TO LEAVE WITH US?
Well, your financial future is in your hands. No matter how great the advice you are given, it won’t work unless you are determined and work towards making it work. Thank you for having us.