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Finance

By Acura Labs | 23 November 2020

Facts Check: 5 Financial Management Myths!

1. Financial planning is a headache

People who have the above opinion have not fully done financial planning well. In fact, financial management will actually help you better understand your financial situation, so that you can avoid situations that make more acute headaches happen.

Managing finances properly means that you are in control of your finances and know where to spend your money in order to prepare for the future with more confidence. Difficulty will actually appear if you force a lifestyle beyond your financial capabilities.

2. Financial planning is only for the rich

Financial planning has a different role for everyone. The difference in financial problems will certainly affect the goals in financial planning. For more established people, of course they are not at the stage of relying on a monthly salary to meet their needs, but rather diversifying their assets or planning inheritance.

So, financial planning is actually needed for those of you who have many goals but limited funds. Therefore, you need to carry out a financial management strategy so that there are goals that can be realized.

3. Financial planning is carried out when there is money

Some are truths, but not completely. Why is that? Because there will always be the temptation to do impulsive buying, especially if you just got a sudden fortune like a year-end bonus. Well, the challenge here is how you can take advantage of that unexpected bonus effectively.

If you think about it carefully, this bonus could be an opportunity for you to prioritize other needs, such as paying tuition fees for school children, paying off debts, meeting reserve funds that were used up, or it could be to pay vehicle taxes. By recording finances, you can be more targeted in using these funds.

4. Financial management forces us to save money without being able to enjoy our own salary

In fact, by making a clear budget, you can stay happy without feeling guilty. How to? You can make a budget according to its allocation, one of which is with the formula: 10-20-30-40, which is 10% of income for investment, 20% for individuals (each husband and wife gets 10%), 30% for debt repayments and 40% for living expenses.

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The figure above is just a benchmark, it should be adjusted to the financial condition of each. In essence, you can still make a budget that is allocated for personal needs, so that living happily without feeling guilty is no longer a mystery!

5. Financial planning is only for young people

Do older people no longer have to deal with money? Certainly not! Surely as long as you are alive, you still use money to meet your daily needs, don’t you think? Well, the hope is that if you have known financial management since you were young, you already have a strong financial foundation. Especially when the age has entered a more senior number. However, it is never too late because it is better to start financial management than to completely ignore it.

Okay, I hope the facts above make you more enthusiastic about starting financial management. Don’t forget to keep an eye on the next interesting article!

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