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Last month, the banking community in Nigeria celebrated the 2018 Financial Literacy Week.
The annual Financial Literacy Day celebrated by the Central Bank of Nigeria and financial institutions in the country is meant to mark the Global Money Week usually held between March 12 and 18.
In line with the CBN directive, top management employees of banks go to different schools across the country to teach and mentor pupils and youths on basic money management skills and banking in general.
The financial literacy campaign is an initiative of the CBN and Junior Achievement Nigeria, in partnership with Bankers’ Committee.
This underscores the reasons individuals need to acquire banking and personal finance knowledge, especially as banking continues to go digital.
Tax season can be a painful reminder of how adequately (or inadequately) you tracked and budgeted your lifestyle the previous year.
This is particularly important as the Federal Government and state governments increasingly put tax payment issues on the front burner.
Knowing how to set up your personal budgets, goals and financial processes isn’t only handy for filing taxes–it’s a lifelong skill you’ll need year after year to remain financially strong.
But you don’t have to be a certified financial planner to understand the basics of personal finance, according to money.usnews.com.
In fact, there are a multitude of free resources available to help you expand your financial know-how.
In celebration of the Global Money Week, here are a few ideas, according to money.usnews.com.
Your local library is a hub of all kinds of information, including educational personal finance workshops and developments in the banking industry. Public and private libraries across the country have information to help you improve your knowledge of banking and personal finance. There are various journals you can read to improve your financial literacy level.
Some of the most famous personal finance experts have achieved success only after experiencing a financial low. They’re real people who have been there and done that, and have written extensively about the knowledge they gained the hard way.
Their struggles are manifest in insightful personal finance books about the best practices for managing money and planning for your future.
One example is Dave Ramsey, who coined the “7 baby steps” for getting out of debt in his book “The total money makeover.” These types of books offer a detailed look at financial remedies when challenges start to mount.
Similarly, planning ahead is equally important. Robert Kiyosaki, author of the “Rich dad poor dad” series, shares how generating income through assets, such as real estate and rental properties, can help you achieve wealth in the future.
The word “tertiary institution” might make you cringe by stirring up naira signs in your mind. But not all tertiary institutions courses come at a price.
For example, some universities provide the personal finance foundation you need to excel through an online learning platform. Free courses such as “Fundamentals of personal financial planning,” have been developed with the help of grants to help people improve their financial knowledge.
More and more websites, on-air personalities and even the personal finance experts noted above have adapted social media into their outreach strategy. You could follow them to get fresh tips on how to manage your money now and in the future.
Also, following the finance pages of news outlets on Facebook and Twitter can help you stay on top of current events and how they affect your wallet. By staying aware of financial news stories, you can apply this knowledge to your everyday life.
TED talks in the United States began as a discussion on innovation within the technology and science fields, but have since grown in scope to include topics ranging from music to money. While attending a TED conference can be financially daunting, hungry personal finance disciples can find thought-provoking finance lectures on ted.com. You may, however, need to adapt some of the lessons to the Nigerian banking environment. There are local websites that can offer tips that are relevant to Nigeria.
This knowledge hub goes beyond humdrum personal finance topics by offering a fresh perspective on conventional advice. The concepts shared at TED talks might best serve someone who’s well attuned to the basics of personal finance, but could be equally engaging for someone who’s just starting with financial planning.
Whether you incorporate all of these resources into your personal finance repertoire or just one, you’ll be closer to achieving tangible financial success by improving your financial literacy.
Importance of financial knowledge
It’s necessary to have at least some financial knowledge, regardless of whether you hire someone to manage your finances or you manage your own. Financial skills can help you make the right decisions, and help you discuss your finances with your accountant, adviser, financial institution, and investment company.
Why you need money management skills
Whether you’re a self-employed tradesperson or running a retail, home-based or online business, it’s important to understand and manage your money wisely. When starting and running your business, you’ll need to do things like: take care of the bookkeeping, make decisions about investing in tools or equipment, manage debts and paying your suppliers.
Others are: managing cash flow, deciding on payment terms, creating invoices and collecting payments from customers.
You need to manage your inventory costs and calculate your inventory turnover rate lodge tax returns.
Maintaining your own financial statements can also save you valuable time and money, and help convince lenders that you are a good candidate for receiving finance.
How to improve your financial literacy
The ways you can improve your financial knowledge and build your understanding of financial terms, financial statements and financial analysis, include:
Whether it’s for yourself or a staff member, training is the best way to take control of your finances. There are a number of free or low-cost training options available to give you the right start, including the ‘Be MoneySmart’ course available from the MoneySmart website.
Learn the terminology
While financial jargon is difficult to avoid, developing your financial knowledge can give you better control over your finances. Learning the terminology can also give you a better understanding of your financial statements, and enable you to ask more specific and often more crucial questions.
Asking your accountant and/or business adviser questions can improve your understanding of your finances and increase your financial literacy. It can ensure you’re fully informed before making financial decisions, as well as help you uncover possible errors.
Rural financial counsellors help farmers, fishing enterprises, forest growers and harvesters, and small related businesses through their one-on-one service.
Apart from your personal bank account, you need to develop your financial knowledge for effective running of your business accounts in line with the emerging trends in technology.