this is part of Covidnomics. For more information go to www.ooberkidsrepublic.com
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Created by cecilia valente
over 6 years ago
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Close
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Created by cecilia valente
over 6 years ago
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When we decide what to do with our MONEy
We take
FINANCIAL DECISIONS
* Choosing a Saving Product is a financial decision
* The word 'Saving' is Latin for 'salvus' or 'safe'
* It is also a matter of economics because you pay an opportunity cost (you give up buying something to save)
Before selecting a saving product, you should
* Pay off your debts
* Build up an emergency fund for urgent expenses (dentist bill, boiler repairs, temporary loss of work)
* Check the inflation rate (how fast prices are rising)
The right saving product
* Beats inflation (the interest rate it offers is higher than the inflation rate)
Time Horizon
If you are saving for an event taking place or something you need...
* within three years - your time horizon is SHORT
* between three and five years - your time horizon is MEDIUM
Examples of Financial Plans for the Short Term
* your annual holiday
* Christmas presents
* urgent need: for example buying a new car/bike (the one you have cannot be used much longer)
WATCH INFLATION
Examples of Financial Plans for the Long Term
* buying a property
*paying for further education (university)
* funding a special project (start a business)
