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The importance of money management essay
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The importance of money management essay
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It would be liberating to live life without being constantly confronted by money matters. Unfortunately, or fortunately money is the oil that keeps the world system chains turning; governments, institutions, businesses and households. Money is the reason majority of adults grapple with going to jobs that they are not necessarily too excited about, in order to put a roof over their heads and clothes on their backs.
Since money plays a very significant role in our daily lives, it must be handled with great care. The quality of life lived is determined by how much disposable income is available. It determines the location of residence, quality of healthcare that can be accessed, education and every other basic need necessary for comfortable living.
Proper money management is of paramount importance. One of the tools of money management is a personal budget. A budget is a detailed analysis of an individual’s financial plan. It is a very important tool for personal money management. It basically helps in identifying how much money is earned and how much is spent. It must be broken down to the very last detail (read cent). If it is not detailed then it is not comprehensive, hence ineffective (Council, 2012). If one is in the know about how much money they earn and spend, they are in a better position to make accurate short-term and long-term financial projections and decisions.
The main reason why people do not keep personal budgets is ignorance. There isn’t enough emphasis put on the need or importance of a financial management. There is more emphasis on spending and advertising goods and services to the consumer. Attention is more focused on spending and earning than on saving and proper financial management.
It begins from the hou...
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...g, health care, education generally translates into a good quality of life, though not in its entirety. It also gives a general sense of well being and peace of mind.
Keeping a personal budget will help to identify unnecessary expenditure. This money can then be channeled into mere productive ventures like investing in bonds, shares or saving. These provide a more disposable income. Not only in the short term but in the long term as well.
Resting in the knowledge that one can afford to access good quality goods and services leaves mental space to focus on other more important things like developing creative ideas for innovation, healthy family and social relationships. It is worth noting that money, whether lack of or in plenty causes many household and social problems. Majority of these problems can be solved by adopting effective financial management strategies.
Money is something that can either be used for the greater good of society, or it can be contorted into something that is detrimental to society, it all depends on whose hands that money happens to fall into. Human tendencies begin to change once people come to have money, the lavish and selfish lifestyle begins. Entitlement comes with having money because money gives people what they want which makes people think they are entitled to get everything they want. In The Great Gatsby Fitzgerald portrays that money is the root of all problems with can ultimately lead to loneliness and careless behavior.
While the idea of money as being so important in daily life in the modern era is not a concept that is given much thought, it is very important to realize that this is not exactly a new concept. It was as important during the medieval period in the time of Saint Francis of Assisi. Wealth, in many cases of modern times and medieval is seen as both the main factor for running the world as well as its downfall. It is something that no matter the period we as humans understand and use to classify the world in both abstract and in more literal ways.
As the old saying goes, money is power. As the statistics show, some people have an insane amount of money, yet their fellow countrymen have close to nothing. In a struggling economy, unfair distribution of wealth can create real problems and unimaginable hardships for some people. For example, millions of people pay $2 for a bottle of designer water, while millions more live on less than $2 a day. If this is to one day change, wealthy people must adopt a much more magnanimous conviction towards their money.
There is one thing in this world that can really separate people, make them comment crimes, and make them completely change their entire outlook on life and that is money. The all mighty dollar is what they call it and it does a lot of good in this world but it can also cause a lot of pain and hurt. Everything we do in our lives revolves around money, what we do and what we don’t do. The real question though is does money really separate people in their daily lives drastically and if so how much does money play in our lives?
Few of us can deny the importance and power that money has in our society. It is difficult to think of issues that affect us on a daily basis, that does not involve money. But where does this fixation on money originate...
I understand that monetary levels can be a stressor for those in lower income settings. With monetary struggles, a person faces higher levels of stress as they struggle to provide basic needs for themselves and their family. Ultimately this results in distress and deviance and they cannot fit within typical social norms of
The world revolves around money. Not only is money the base of our society, but people also depend on money to live a healthy and secure life. People have lost their homes, their families and th...
Accordingly to Aristotle when he said, "Poverty is the parent of revolution and crime." He revealed to us the most important object that people would do anything for it, and it is obviously the money. Even though money is a common need among people, does
Making a personal budget can be a very simple or a very arduous task, depending on how one goes about it. One must find stable monthly expenses, such as rent, and manage the rest of their income around that amount. Depending on the steps an individual takes, this can be a very simple process. For this project, I was assigned to make three personal budgets for three different situations. This paper will outline the first.
It is easier for wealthy people to pay for their needs, such as health care and dental care. If any abrupt situation approaches dealing with their health, a wealthy person will be financially stable to pay and fix it. According to an article, "Happiness Around The World: Is There More To It Than Money?" by Bozionelos, Nikos, and Ioannis Nikolaou, “One would expect that money is more important when it helps meet basic needs, and this should be especially true in poorer nations. However, as already seen, the relationship between income and general life satisfaction was mainly explained by whether material aspirations (such as buying luxury goods) could be fulfilled.” In other words, one’s concept of happiness can vary from nation to nation. For example, people living in poor nations and having a low income tend to be satisfied by having just enough to meet their necessities. While, on the other hand, people with higher income tend to be satisfied if they have enough to buy luxury goods. Being wealthy does not lead one to happiness; it can help some people to obtain happiness, but it can also lead others to have unwanted experiences. Having a minimum amount of money is necessary to be happy. Having the minimum amount of money to pay bills, have medical assistance, buy groceries, and clothing is considered as the basics needed for one to be happy. Money is a tool that can help a person obtain objects that can help him or her to have a comfortable life. However, money should not become the reason why a person is happy. Happiness comes within a person as a human being and money will never replace a friend, nor a loved
Budgets are an important part of personal financial responsibility because it helps control what your spending. It will help identify wasteful expenditures such as everyday take-out and buying expensive clothing, it also helps to adapt quickly as your financial situation changes, For example being in debt, and achieve your financial goals. A budget can help understand your spending habits. For example: By figuring out where your money is going, you’ll be more aware of where you need to cut back to pay off your debt and contribute to saving. Budget is important because it can help you to stop living paycheck to paycheck. By creating a personal budget, you can to see how much money you are spending throughout the month.
Personal financial planning is important because it helps you prepare financially for the future. My first short-term financial goal is to have an 8-month emergency savings account. This class helped me understand the important steps needed to achieve my financial goals. “Successful financial planning requires specific goals combined with spending, saving, investing, and borrowing strategies based on your personal situation and various social and economic factors, especially inflation and interest rates” (Kapoor, Dlabay & Hughes, 2012). First I evaluated my spending habits. This allowed me to see where I was
Many people argue that money is not the key to happiness. However, have you ever seen a sad person riding a Ferrari? Or have you ever seen a man crying because he is too rich? In fact, I have no doubt that you've seen a man crying, because he is too poor. Money brings a lot of things to our lives. Money gives us what we want, gives the possibility toward a better future, and brings love and friendship as well. Therefore money is the ultimate key to happiness.
Economic on social life, as per my studies ,I feel money is important for everything if you have no money we cannot move on in this world, since everything has expenses we
... care. Second of all, once you have all the things you need and you still have money left over, then go buy the things you want. Saving money and spending it well will make a vast difference on your life. There are many more solutions to poverty, however, these two are the most important to me.