Money management helps one to control expenses and save the money for other purposes. Money management is a healthy habit. In this article we are going to know why money management is important and how it affects the different classes of society.
Earlier our ancestors usually said if we spent our money on unnecessary Mata laxmi ( Devi of wealth) would leave your house. They basically advise the next generation to manage the money. Today the words might change but the habit of managing money is considered a good habit.
Nowadays the rich become richer and the poor become poorer. The reason could be many of this situation but the factor affect the all reason is money management
Our society divided into three part basically:
- High or luxury class – This class has a luxurious lifestyle. They are mainly tycoons, businessmen, ministers , doctors and high ranking government officials.
- Middle class- This class has a normal lifestyle. They have to earn to feed themselves and get education and pay taxes. They are mainly teachers, low ranking government officials, professors and monthly paid workers.
- Low class- This class usually wagers who work on a daily basis for their daily bread butter.
Here the point should be noted that high class people live their life without any financial difficulties. Lower class know that they have to work and eat on a daily basis but the middle class people have to pay tax, need to work hard to reach high class and couldn’t complain when they compare their lives to the lower class.
For this, Money management is a way to make a balance point.
What is money management?
Money management is a science as well as an art of organising money to fulfil the needs of an individual or group. The process includes spending, investing and budgeting the capital.
Importance of money management
We always get advice that watch over the expenditure, don’t buy unnecessary things, do investment, prepare a budget of your expenses and save money on a regular basis.
- To get the future goal
We all have some major goals in our life. That goal needs a large amount of money to complete. A higher class person’s major goals could be buying more firms or luxurious items. A lower class and a middle class person have different goals such as building a home, children’s marriages and their own lifetime security. A lower class person could not put such efforts but a middle class person has to put efforts to make an image in society. They borrow the money from legal and illegal methods to match the status of higher class. It leads them to the grave of loan. Money management can help all the classes to reach their goals. If they watch over their expenses and save money on a regular basis they could attain their future goals.
- Managing risk
Money management also gives support to managing the risk. Life is unpredictable. We don’t know what could be next. So it is important that we have enough savings to manage that risk.
- Help in saving
Money management also helps in saving money for the future. When you make a budget of your expenses, you get an idea where you spent more and less. You try to find an alternative and reduce your expenditure. That you know how much and from where you can save the money.
- Bring more opportunities
Good opportunities need a good amount of money. As we know today every skill furnishing classes are so expensive. In the competence world we need to learn new skills everyday. If We want to grab opportunities we need to be financially strong. Money management helps us to bring more opportunities to reach our goals.
Many times we think about how the rich become richer and the poor become poorer. Do they have their own bank or government supporting them? Are rich people not giving the appropriate amount of wages? Is it because of unequal distribution of resources?
The answer of all is a live example- Dheerubhai ambani. His father was a middle class person but he built an emperor for his sons. He made it possible because he knew the management of money. He invests, saves and expands his money by analysing, rethinking and with a backup plan. After him his son mukesh ambani and his son also follow the same path. In their case we can say children learn managing the art of money from their family.
Poor or lower class people thought that only higher education can help their child to become rich or upgrade their living standard. But when the child is not introduced to the term management how could they learn financial management?
The middle class people have knowledge about money management but they never implicate such terms in their lives. They are dependent on loans for their further needs.
So it is important that schools need to involve such subjects which could make a brief understanding of money management at primary to higher levels of education. There should be some activities in the curriculum which provoke the student to learn money management. Most of the well educated people don’t know the basic rules of investment. They don’t know because they never get a chance to do so. It is a high to make awareness among the people about the money management.