Financial Literacy: The Basic Requirement for Financial Freedom (ebook)

Description

Attaining financial freedom is not easy as it requires basic financial understanding. Acquisition of financial understanding is driven by the desire and mind-set change to alter ones current financial situation. It takes determination, willingness to learn and discipline to do so. Many people are just content with having just enough to get by. The financially uninformed are vulnerable and prone to manipulation and abuse by those they have trusted with their financial affairs, whose intentions are to keep them in the dark. It is as a result of this financial ignorance that most aspiring investors, entrepreneurs and small business owners are unable to make their hard-earned income work for them when they have the opportunity to do so.

The lack of basic financial knowledge results in risks that deprive the aspiring investors, entrepreneurs and small business owners the opportunity to maximize returns on their investments. Financial literacy or the lack of it affects us on both the personal and business sides of our lives. There are two levels of financial literacy, the lower level and the higher level. Lower level is about the ability to budget and follow through, saving, paying bills, and understanding the importance of keeping a good credit score. Even at this level many people still lack the discipline for commitment. At the higher level financial literacy is concerned with the attainment of financial freedom through wealth creation strategies. This level requires an understanding of the impact that the financial and economic variables have on business activities. It requires business awareness. One must first master the first level in order to be effective in the second level. The lack of mastery in level one is one of the reasons why many people are not able to advance to level two of financial literacy.

Everyone can make money but very few are able to create wealth as a result many of those earning income are unable to do so. This explains the danger of the lack of basic financial understanding. So, the acquisition of basic financial skills is the beginning of financial wisdom that kick-starts the need to create wealth so as to be financially free. Financial health has to do with the ability to create systems that generate passive or perpetual income. Besides, personal income is the most expensive income from the tax perspective. Wealth creation minded people are more conscious of the tax implications of the different types of incomes.

 We may not all be entrepreneurs or business owners but we can all be investors. The best approach to embarking on the road to financial freedom is to start from where you are with what you have. Procrastination is the thief of time, the sooner you start the better. Get yourself enlightened in the ways of improving your financial health. From where you are it is possible to be financially healthy. A journey to your wealth creation starts with taking small steps from where you are in the right direction. Wealth creation is not an event but a process. You need just the right basics to get started.

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