Text for additional reading and discussion

Read the text and head it. Ask questions so as to cover the contents of the text. Discuss them in small groups.

If you were asked about your finances at night, awaken from sleep will you remember the figures? Will you remember your deposits, your debts, your net savings, your average monthly expenses? Not many of us can answer these questions. Money is one of the most important parts of our life, but we don't know much about our own finances in precise terms. Is that not surprising?

Money management plays a very vital role in success. If you were to put the same questions to a very successful person, you will get all the answers with the necessary and detailed analysis. Those who make very big money understand the importance of money management. Unless you manage your money, you will not be able to make best use of it. I would discuss few important parts of money management here.

• Debt. Don't take debt if you can manage without that. The thought that you have debt makes you feel uncomfortable and kills enthusiasm. Ask two persons about their life – one who has no debt but lives very simply and other who has debts and lives wastefully. You will find out that one without debt is enjoying his/her life more.

• Increase Savings. Save more and spend less. Your savings will not only be useful for a rainy day but also create an emergency fund for you that can be used when the right opportunity arrives.

• Increase Profits. Target good profits and try to reach that figure in your business. If you are employed, set targets for your salary and achieve it.

• Reduce Costs. Wherever possible, reduce costs. Avoid all unnecessary expenditures. Reduce every costs. Live economically till you save your first million. After that it will become easy to earn more and spend more. If you do that right from the beginning, you will never be able to save your first million.

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Questions for economic reasoning and discussion

1. Give your reasons for or against the following statements/ideas:

• Managing your money means paying attention to the money you have and how you use it.

• We all use our money in different ways, reflecting our cultural, moral, and spiritual values.

• Money is the most important thing in our lives.

• Choose the variant that suits you best of all. Only one is possible. Explain your choice.

1. Do you know how to manage your money?

1. Write down your daily purchases in a small notebook.

2. Use your debit card for most purchases, then track your spending with Online Banking

3. Use budgeting software to create a spreadsheet of your income and expenses.

4. All of the above.

2. When it comes to vacations…

A. I love to plan every detail and expense.

2. I try to make them as inexpensive as possible or do not take them at all.

3. I plan for it to cost within a range because I know that I may spend more than a specific dollar amount.

4. I don’t plan at all, the whole point (уся суть у тому) is to have fun isn’t it?

5. I just hope that I have enough to pay for it.

1. At the end of each month…

1. I always seem to be short of money.

2. I can tell you how much I will have left almost to the penny.

3. I am never sure if I will come out a bit ahead or a bit behind each month.

4. I don’t keep track of my money too closely, but I know that I will come out ahead each month.

4. My money goal is…

1. to save as much as possible.

2. to have enough to pay for my basic needs and have some left over to save or invest.

3. to have enough to buy whatever I want.

4. to be able to treat myself every now and then (час від часу).

5. I don’t really have any goals.

5. Which of the following Beatles song titles best describes your relationship with money?

1. Help!

2. The Long and Winding Road.

3. I Feel Fine.

4. Here, There & Everywhere.

6. If I found a suitcase containing $100,000…

1. I would be thrilled and try to figure out how to make it grow while using it for my own enjoyment.

2. I would be very excited because now I could get anything I wanted.

3. I would want to save and/or invest it, but would likely take a big portion and spend on myself.

4. I would have no idea what to do with it.

5. I would carefully explore very conservative investments and/or put it in the bank.

7. Which of the following statements most accurately describes your feelings about credit cards?

1. I am always surprised by how much I have put on them when I get the bill each month.

2. I probably use them too much, but it rarely bothers me.

3. I rarely use them or pay them off every month.

4. I don’t use them at all.

5. I use them too much and it bothers me.

8. Saving Money…

1. is my primary goal.

2. is hard. It seems that as soon as I get a little put away, an unexpected bill comes up and I have to take it right back out again.

3. is something I do without fail (незалежно від обставин). I have a carefully designed plan in which I put some money away each month.

4. is something I try to do regularly. I try to put aside the same amount each month, although there may be some months where it is a bit higher or lower than usual.

5. is something I think I may have read about in a book once.

9. When I feel down in the dumps (бути в поганому настрої) spending money…

1. always makes me feel better.

2. on way to make lots more money makes me feel better.

3. is not what I do to make me feel better.

4. makes me feel worse. Saving money helps me feel better.

5. is not something I would do. Reviewing my budget to make sure that I have enough money makes me feel better.

10. When I bought my car…

1. I bought what I liked and worried about the cost later.

2. I ended up spending more than I had planned.

3. I found a compromise between what I wanted and what I could afford.

4. I very carefully researched every detail, ensuring that it would fit into my budget and made sure that I got exactly what I had planned.

5. I didn’t really do any research, I was more worried about whether or not they would accept me for financing.

11. Which of the following books would be most helpful to you?

1. “Basic Tools of Budget Development”

2. “How to Make Money and Hold Onto It”

3. “How to Maximize Your Investments”

4. I should be the one writing the book on money management.

12. When it comes to retirement…

1. I am very systematic about planning for my future and feel reasonably confident that I will have enough to retire comfortably on.

2. I may not always save as much as I could or should, but am saving on a consistent basis and feel pretty confident that I will not have any problems.

3. I am somewhat worried as I have such a difficult time saving any money.

4. I am quite anxious, as I don’t have any savings for the future and don’t really know where to turn to in order to learn how.

5. I don’t have any savings but am not too worried since the future will take care of itself.

13. Which of the following statements best describes how you feel about your income?

1. I am doing o.k. with what I make, but a little more to put aside or invest would be nice.

2. It would be nice to have some extra money for when the credit card bills are higher than what I anticipated.

3. I could use a lot more than I am making right now to get the things I have always wanted.

4. Everyone can always use more money but I am just not sure how much more I would need.