Top 7 Skill set to Financial Prominence1. Knowledge of Budgeting2. Knowledge of Debt Management3. Knowledge of Personal Financial Planning4. Knowledge of Money Saving5. Knowledge of Insurance6. Knowledge of Investing7. Knowledge of Child InvestmentsEach of the mentioned skill set have equal importance in financial life of an individual. Reading, assessing self and building required skills on each of these areas help you to be a financial planning prominent person.
1. Knowledge of Budgeting
Budgeting is the heart of financial planning. Through budgeting, an individual able to define his assets and liabilities. He will be in a safe side by getting control over in/outflow of money. When having knowledge on budgeting, a person has several advantages. He will get a clutch on his income against expenses, able to identify and control unnecessary spending, proper allocation of money for rotating expenses, allocating money in a right percentage to control his debts, have well idea on his possible savings and workout to increase savings through controlling his expenses and unnecessary costs etc. All over the above advantages, his financial life become more structured and controlled.
2. Knowledge of Debt Management
Debt Management is not a profession, but it is an art. Debt is so easy to manage and the same time very difficult too, depends on individual and his skills. Acquiring knowledge on debt management gives an advantage of taking full control over debts. Through taking control, one will be able to identify and prioritize bad debts, drawing plan to eliminate debts, identifying proper allocation of money to each debt by considering its priority, total control over the money allocated to pay-off debts, monitor the status and being debt free as ultimate.
3. Knowledge of Personal Financial Planning
All other 6 sections are coming under the Umbrella of Personal Financial Planning. In plain English, personal financial planning is the root of all financial knowledge. The best part, you don’t need to waste extra time for acquiring knowledge on personal financial planning. Whenever acquiring knowledge on other 6 areas, you will be a master in personal financial planning automatically. Branches of personal financial planning are: planning and execution of budget for life, controlling and managing debts, taking necessary steps to get protected from consequences happening to self and family members, identifying all available possibilities to save money, able to face emergencies boldly, secure future of self, family and children by saving and investing.
4. Knowledge of Money Saving
Knowledge on money saving have multiple advantages. Some of these are, a person will be able to differentiate the ‘need’ and the ‘want’ to spend money for right purposes, become structured on spending, identify loopholes that causing loose of money unnecessarily, increase monthly savings through add controls on spending, increase utilization power of any items to its maximum, become knowledgeable on necessary stuff to prevent lose of money from renting labors, pour his money saving skills to his kids and family members etc.
5. Knowledge of Insurance
Through acquiring necessary skills on insurance, an individual getting equipped with must have knowledge on protecting self and family for now and future. Major advantages from attaining insurance skills are, define exact protection required for self and family, protect the life and financial future of family in case of the untimely death of bread winner, getting full control over huge possible expenses can happen at any time from situations like hospitalization, natural calamities, theft, accidents etc., all over the above, can lead a secure and free life with total protection.
6. Knowledge of Investing
Acquiring knowledge on investing have huge advantages to the financial life of any individual. It is not only a must skill required section, but it is a necessity to plan your future well. Investing known as the heart of actions to attain future goals. Through having excellent investing skills, a person able to assess and understand his risk taking capacity, set right future goals to achieve, identify right instruments to park money, understand the advantages and disadvantages of various investing instruments, having better idea on the return side and lose probabilities of each investment instruments that he select, build a portfolio with right mix of investment products, identify the best product and time to invest, monitor portfolio time to time and do required churning activities to control investment proportion suitable to age and risk etc..
7. Knowledge of Child Investments
Knowledge on Child Investments is the final area with ‘Top 7 Skill set to Financial Prominence’. Parents working to provide maximum betterment to their family, especially for kids. To secure the life of kids, a person should acquire required skills on child investments. Through equipping with this skills, he will be an expert to, early identification of the future financial needs of his kids and set plan to achieve these goals for example: higher education, marriage of kids etc., able to build structured saving habits, analyze and identify best product bundles to invest for child, monitoring activities for time to time to ensure the capacity of investments to achieve the goals etc… More over these, an individual will be able to execute a right plan to provide maximum betterment to the kids whether he is with them or not, at the time when they need the results of his efforts.
Except Point 3, an individual required to work hard by referring guides, articles to acquire required knowledge on each area. Reading great books, referring case studies all will help to understand the basic of each section to lay an important stone to financial freedom. If you dig further in this blog and refer other most famous personal finance blogs like ‘The Digerati Life’, my most admired financial planning blog, you will be able to find number of useful articles to kick start yourself to the financial freedom.
If you like this article, feel free to comment on it. I value your comments as most. Feel free to subscribe TMM to receive further such articles directly to your mailbox.
Picture: chichacha