LET US PLAY FINANCIAL FOOL !

Irshad JACKARIA

At Knowledge of the ART, we use the time that is reserved to play April Fool on the 1st day of this month, to reflect on whether we are being and/or have been a Financial Fool over the past year. The mistake that we often do is to confuse generic education and intelligence with financial education and intelligence. These are two separate and distinct set of competences. Educated and intelligent people, in general sense, can be less enlightened and cultured in terms of financial education. Our objective here is to offer simple guidance on how we can better manage our finances, set sight on our future objectives with more structure and composure and start or pursue a journey of self-discovery. 

Usual mistakes:

  • Uncontrolled credit card usage.
  • Excess use of credit purchase and hire purchase.
  • Taking loans to finance current expenses.
  • Living to impress others.
  • Gambling and dreaming, then dreaming and keep gambling.
  • Always focusing on what you don't have. 

Simple Advices:  

  • Have a monthly consumption budget and stick to it. 
  • Have a yearly capital budget for your non-current expenditure and adhere to it. 
  • Instill a savings culture, and keep it even in times of difficulty. 
  • Life cycle planning, with special focus on children's education and one's retirement. 
  • Don't spend money that you do not possess. 
  • Don't risk money that you cannot afford to lose. 

In the end, we must avoid living in the past and we must avoid confining ourselves to the regret of omission (why I did not take this decision) and the regret of commission (why I took this decision). Let us rather use the past as a learning tool, plan our present in a more judicious way in order to have a more comfortable and serene future, knowing that there will be many more variables outside our control. More to come from us on this topic ... WATCH THIS SPACE.