The content we have created is divided into the four main things you can do with money when you have it:
In each of these sections, we look at the various terms and concepts we think you need to know and understand. These include:
- Money – What is money
- Spend it – budgeting, spending wisely, and taxes
- Save it – saving, and the role of banks (including borrowing)
- Invest it – setting your goals, investing, insurance, fees and retirement
- Give it away – charity and philanthropy
We believe we have covered a lot of ground with our content – but probably the most important money-related lessons you should take away from all this material are summarised as:
- Take control – to be able to manage it well, it’s important to, some simple tips are: start early, set up a budget, spend only what you have or can afford, do not let debt build up, and save an emergency fund of three to six months of living expenses to deal with any unexpected crisis.
- Set financial goals – however large or small, doing this can give you a real target to aim for. Even if your goals change or you create more of them at different points in your life, you need them to work towards and save for.
- Start saving early – this will be a big advantage for you, because of the impact of something called ‘compound interest’ (to be discussed under the section on ‘Save it’). It also creates good discipline as you can quickly accumulate money you need to achieve your goals – including big ones like buying a house and having enough for retirement.
- Avoid anything which is ‘too good to be true’ – if you come across opportunities to earn money, invest in something, or borrow more money which seem better than anything else you have seen or heard about, it probably needs further research. This also applies to this is supposedly ‘free’ advice from professionals. Somebody will be getting paid for it, even if they don’t tell you how and it isn’t obvious. Always ask questions until you understand exactly what you are buying, and how much it will cost – both now and over the long term.
- Don’t borrow more than you can afford – borrowing money is not a bad thing, as there are different goals and certain types of ‘debt’ that you accumulate is considered ‘good’ debt, which has a specific goal that is positive over the long-term. However, you need to be aware of ‘bad’ debt that might cost a lot more in the long run than you thought it might, or might be more than you can afford to pay back.