"FINANCIAL LITERACY; THE IMPORTANCE OF SAVINGS“(FINANCIAL MANAGEMENT: SAVINGS AND INVESTMENT)
Laja Shoniran
Project Director
Financial Literacy for All (Teach To Save Initiative)
Background
‘Train a child the way he should go, and when he is old he will not depart from it’ Proverbs 22;6
‘Go to the ant … consider her ways and be wise Which, having no chief, Officer or ruler, Prepares her food in the summer. And gathers her provision in the harvest. ’ Proverbs 6;6-8
Objective
The concept of money What is Money? The three aspects of money The importance of money Money Management
The concept of savings What is savings? Why, How and Where do we save?
The concept of investment What is investment? Why should we invest?
The Road map
Opening Thoughts Some Definition Why do you save? Misconceptions about savings How to Save
WHY SHOULD I LEARN MONEY SKILLS?
If you invest as little as N1000 per month, you could become a millionaire.
This works according to the principle of
compounding interest.
Compounding interest will help you grow your money without having to work for every dollar.
WHY SHOULD I LEARN MONEY SKILLS?
What percentage of lottery winners wastes all their winnings within a few years?
Answer: 70%
How many football players and celebrities are broke or bankrupt within 5 years of retirement?
Answer: More than 60%.
WHY SHOULD I LEARN MONEY SKILLS?
How you handle money affects
Lifestyle
Help others
Free time
Reduce stress
Make the world a better place
How you handle money
Managing your money
Opening Thoughts
“ A penny saved is a penny earned” Benjamin Franklin
“You are not rich by how much you spend but by how much you save” Laja Shoniran
“If you earn three pence and you did not save, even if you earn one shilling you will not save” African proverb
Precious treasure and oil are in a wise man's dwelling, but a foolish man devours it. Proverbs 21;20
Opening Thoughts
“Through wisdom a house is built, and by understanding it is established; and by knowledge the rooms shall be filled with all precious and pleasant riches” Proverbs 24; 3-4
“Poor is he who works with a negligent hand, but the hand of the diligent makes rich” Proverbs 10;4
The greatest of all diseases in life is the absence of money where and when it is needed
Dream Time (A Dream is the wish your heart makes)
Write down three important things you want to accomplish in life Education Career Family Business Travel Politics Others – philanthropy, social cause,
What is money?
Goods Services Desires ExpectationsAchievementsAccomplishment Relaxation
Bible says – Eccl 10;19
‘..Money answers/facilitates/finances all things’
What is Financial Literacy
Understanding how money works The ability to make appropriate decisions
in managing your personal finances. being able to understand and analyze
financial products in order to make smart decisions about what to do with your money
The ability to make informed decisions about your money
Three aspects of money
Earn Money Income generation – passive or active
Manage Money Saving, Spending, Budgeting, Planning
Multiply Money Investments, Business, Real estate
What is Saving?
Rescue from harm, danger, or loss. Avoidance of excess expenditure;. A reduction in expenditure or cost. Saving is income not spent, or deferred
consumption.
What is Savings?
The portion of income/money not spent on consumption of consumer goods but accumulated for investment in income generating ventures – business or real estate, or purchase of shares. Investment Reserve Funds Capital Money
Saving money is difficult
Why? Human wants are insatiable I don’t earn enough Too many responsibilities – extended
family No job – no income Business is slow School fees are too high I spend the bulk of my money on
Transportation
Why do you need to save money?
There is always a tomorrow For Retirement age Emergency To buy or build your own house To start a business or grow an existing one For leisure goods/vacation Education for children To give to charity To grow or multiply money
Secondary school students
To develop the habit of saving To store up money To create a brighter future for tomorrow To be prepared for important life events like
university, wedding, buying a house, start a business, etc
To keep money safe To earn interest and help your money grow To reduce the temptation of spending
irresponsibly To help you access loan to help you in future
Misconceptions about Savings My income is too small for me to save When you save you are worried about the future God will always take care of me financially Money is for spending Saving is hoarding You are stingy or penny-pinching when you save Whatever will be will be – God will have mercy
on who He will have mercy If you are destined to be rich, you will even if
you don’t save
What do you benefit by saving?
Peace of Mind When a person saves money
continuously, it gives them a "peace of mind". An individual will sleep better at night knowing they have additional money put aside
More Income Saving money means an individual will
have more of it at the end of the year. This is what saving money does.
What do you benefit by saving?
Monetary Safety Net Saving money provides a person with a
financial net of safety just in case they lose their job, become disabled or can no longer work. Life is uncertain, but money does not have to be
Saving Earns Interest Allocating money in a certain savings
account will allow it to earn interest.
What do you benefit by saving?
More Options When a person decides to save money and make
it a lifestyle, a plethora of choices is available. One could invest or purchase something they want. It is nice to have some wiggle room.
Attitudinal Change More Disciplined, Can delay gratification easily Can sacrifice and give more easily Values people and values things more
How do we save – money?
There are three basic ways to save money
1. Making specific deductions from income regularly
2. Shopping smart to reduce your expenditure on goods and services
3. Reducing your consumption rate for goods and services
Where to save
Conclusion
There are more than
So get a copy of this book and Start Saving Today!
Thank You
Laja ShoniranManaging Consultant
Infinite Intel ConsultHR Training, Recruiting & Business Consultants
Project Director Financial Literacy for All (Teach Children to Save Initiative)
Tel: 08023005235E-mail: [email protected]:
www.facebook.com/TeachChildrenToSaveInitiative
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