Managing my finances has always baffled me. I had assumed being financially competent was something other people knew how to do well, and somehow I was the only one uninformed. I’ve often wondered, when was I supposed to learn the art of managing money? Did I avoid the class in high school that would teach me everything I needed to know? Were all the business majors in college studying personal finance, something absent from my journalism school curriculum?
I was relieved when I came across Alexa von Tobel’s TEDxWallStreet presentation, One Life-Changing Class You Never Took. I learned that I am not alone.
Alexa is founder and CEO of LearnVest (www.learnvest.com), a personal finance website for women. According to Alexa, most Americans are not formally educated on the principles of personal finance. I hadn’t selectively missed the class; there really wasn’t a class.
What scares me the most is that this lack of education can lead to years of bad financial decisions. According to Alexa, the average American will make six to ten financial decisions a day. These can be as simple as whether or not to go out to lunch, or as important as whether to participate in an employer’s 401(k) program. I know I had not considered my overall financial well-being while making these daily decisions.
We can begin to become aware of our financial well-being and begin to make informed decisions today. Alexa suggests five basic principles to live by:
- Follow a budget
- Be debt free and pay your credit cards in full
- Have an emergency savings account
- Negotiate your salary
- Think about your retirement early
If you are ready to explore principle one: Follow a budget, Empathia can help. Our financial consultants can guide you in creating a budget. On my own, establishing a budget had been frustrating. I found it difficult to take the emotion out of the process, and view my budget objectively. The assistance of a professional makes this process factual, not personal. Plus, it was free!
I am proud to admit that today I am actively educating myself about personal finance. I consider Alexa von Tobel to be the mentor that I have never met. I encourage you to view her presentation at http://www.youtube.com/watch?v=8jkri0AeZWQ and let me know what you think.
Do you have other financial tips that you use in your own life? Have you followed any of these suggestions, and if so, have they helped your financial situation?
Kate N., MS, CEAP, joined Empathia in 2005 as an EAP counselor, then became a performance specialist in 2012. Kate has a master’s degree in Educational Psychology. Kate is devoted to helping individuals determine how to make lasting changes. Prior to joining Empathia, she worked in the social work field as a case manager for Child Protective Services. Kate enjoys baking, yoga and escaping to the woods of Northern Wisconsin.