Financial Education: Why It’s Never Too Late (Or Early) To Learn
What kind of financial education did you have as a kid? If you’re anything like most modern adults, the answer is probably “very little”, limited to what your parents told you about keeping a household budget. How much you retained might also be a worthwhile question, as the framing of these lessons was usually explaining why no, you couldn’t get a puppy or a pool table, because they were too expensive.
Parents try to teach their kids about money, but it is complicated and, besides, parents themselves weren’t taught about these things in school. The end result is that many of us grow up with an understanding of money that leaves us ill-equipped to deal with the modern world. Through one thing and another – choosing the wrong products, missing chances to save, or the levying of penalty payments – this can result in financial difficulties.
The good thing is that it is never too late to learn a few salient lessons that can stand you in better stead to deal with a complicated world. And what’s more, these are messages you can pass on to your kids, and ensure that by the time they head off to college, they will be better-informed on the ins and outs of finance.
Managing credit cards debt responsibly
Many people across the world don’t understand how a credit card works – which is potentially fine, if you don’t have a credit card. But a more shocking stat is that more than one in five Americans, when asked, said they “didn’t know” whether they had any credit card debt at that time. It’s fine to have a credit card – indeed, as we will see, it may be beneficial – but you have to know how to manage them. Without this skill, you can end up in trouble.
Managing a credit card means knowing roughly, how much of a balance is on it at any time. It means knowing you have a payment to make, for how much, and when. It means knowing whether that balance will incur interest. And if you put the effort in, you can practice more intricate card management, like knowing when interest-free periods will expire, and transferring to another credit card to benefit from a new offer.
Knowing the facts helps you talk to lenders and banks
Having a credit card is beneficial; most of us don’t regularly have access to the cash reserves to make a big purchase outright, but a card lets us spread the cost. However, a credit card, or any borrowing, can put you in a tricky financial situation if you don’t properly manage your accounts. It’s all too easy to end up with late fees, overlimit fees and uncontrolled interest. Worse than any of this is the damage that it puts on your credit rating, which can leave you unable to buy a house, maintain an overdraft or even get a job.
It’s not widely-known enough that you can challenge negative comments on your credit file, and have them removed, for a variety of reasons and thus repair your credit rating. Remember, even if you don’t intend to borrow in the future, your credit rating affects more than just your choices in the financial marketplace. Some letting agencies won’t even let you rent an apartment without decent credit. So equip yourself with all the facts about your credit accounts, and learn about the ways that you can challenge your report, and you will see results.
Ask for help
It may sound more controversial than it really is to say this, but of course consumers are on the back foot against bigger lenders and businesses. They have immensely powerful data gathering systems, lawyers, and centuries’ worth of reputation. You don’t.
So when it comes to trying to clear debt, it’s always useful to have advocacy. It can be a friend who’s been through the same things, or a lawyer working pro bono. Whatever the case, it’s useful to take all the help you can get.
There’s nothing cheap about accepting assistance – if you’re in a financial dispute, just remember how much help your bank can call upon. Ask yourself a few questions: would they hesitate to use that help if they had to? Do you feel that a level playing field is what you should expect? Is it important to get a fair hearing and is DTSS legit? All of these questions and more will help you make the right financial decisions.
Knowing how to manage money will save you money in the long term, and what’s more, it will teach you good habits – the kind of habits you can pass on to your kids when the time comes.
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Ken Boyd
Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies
(email) ken@stltest.net
(website and blog) https://www.accountingaccidentally.com/