Why Financial Education is key to address debt problems of people overspending?

One of the reasons why people overspends is because they tend to spend on gadgets or “ dooddahs “  to stay trendy mainly  due to peer pressure behind those needless buys.

There is a fond saying that I always share :

“ We buy things that we don’t need with money that we don’t have or ill-afford just to impress friends or neighbours that we don’t even like !”

The desire to keep up with the Joneses in our  increasingly materialistic society is one of the main reasons why most people tend to overspend.  With companies spending big bucks on advertising aimed at promoting high-end lifestyles to influence and create pressure on young people to buy things, just so that they would appear to look “ cool, tendy or glamorous”. Many young adults nowadays are afraid of been seen as falling behind with trends, and they buy things that they don’t need or want, just to conform with their peers.

The result is that, there is peer pressure and people will tend to buy things that they cannot afford just to stay trendy. Many will buy the items more for the image rather than for their functionality.  Most young people nowadays associate owing material goods with happiness and this is one of the reason why they do not live within their means. The worst thing for them is that they will buy using their credit cards, using future income, buying things without thinking how they will pay for the amount when the payment is due.

In a recent local survey in Malaysia on young workers financial habits and behaviour, it was reported that 60% of people in the survey were more than 60% in debt, which is a cause for concern.

Get Financial Education at a young age.

Therefore, proper financial education should be made to young people at an early stage of their lives, to address the debt issues and problems.

They need to have the right mindsets, skills, knowledge and attitude to help them manage their personal finances. These people need to be financially educated and take time, energy and resources to learn about money, finances, business and investments.  They also need to start thinking about savings for the future.

We must teach  financial education early to young children, teach them the value of money and to have a holistic view of life and realize that happiness does not come from material products alone, it comes from having a good relationships with love ones, families and friends doing things  that they are passionate about and still be able to live within their means.

I therefore urge you to get Financial Educated. Spend time and energy to learn and be financially educated and invest in your own financial knowledge. It will be the best investments that you will ever make  for yourself.

I hope you have enjoyed my sharing. To your success and financial education and abundance.

By Michael Tay   www.michaeltay.com

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