Importance of Financial Education in Making Informed Decision on Spending: Recent Study

The discourse of spending is important if finance is of concern. Those who save money realize the
fact that wise spending leads to saving and hence investing. A household that spends unwisely can
end up complaining on insufficient funds attained. Governments and organizations which spend
unwisely will always cry for budget deficit. Therefore, this chapter provides a discussion on the
importance of financial education (financial literacy) in making informed decision on spending. We
have people in our families who always cry for insufficiency of funds. And to them they think that God
has given an outright favor to some people to enjoy the lives. But we also notice that those who seem
prosperous most of them are not Godly. They demonstrate a bad behavior to families, to people near
them, to our kids. If their prosperity is a result of God’s blessing, we could at least realize that these
people are believers. It was from that line of thinking this study became eminent. This chapter
exemplifies the use of mobile phones, food, fuels, and goodwill as among the key aspects which need
to be looked at, while utilizing our money. The first part covers the introduction which reveals the
definition of financial education as opposed to financial statement analyses (FSA) and or accounts
information (AI). The second part reveals the importance of financial education to individuals,
governments and financial institutions. The third part is the challenges for attaining financial education
and examples that reveal the importance of financial education. The fourth part is the conclusion and
recommendations. The chapter concludes that while income attained at any level is important, most
suffrage related with insufficient income in many households is due to poor spending caused by lack
of financial education. We have noted that most workers once have got a job, the first thing that one
would do is ask for financial support from the bank to buy a car. Assuming that the car one has bought
is at 15,000 USD, and his/her salary is 700 USD per month. The interest rate of a bank in Tanzania
for instance is 19 to 20 percent. This means that you have created a grave onto yourself in the
following aspects. 1) You have bought a car while your emirs work does not need you to have a car.
2) You have created an up for and from vehicle which adds expenses to the salaries. 3) You have
been asked the financial institutions to take part of the money from your very little money to its bank.
What you remain with is very small amount of money. The computation will follow to mark the
evidence of spending to the car for a new worker. Hence this is a must-read book to allow the people
know how to save money, when to buy a car, when and what types of vehicles you should buy while
you are very junior worker, what actually you should not do while at work.