MANAGING PERSONAL FINANCE IN contemporary world
In modern world we meet the term personal finance practically every day. But what does personal finance mean? It is the application of the principles of finance to the monetary decisions of an individual or family unit. It addresses the ways in which individuals or families obtain, budget, save, and spend monetary resources over time, taking into account various financial risks and future life events. Nowadays people manage their personal finance with the help of banks, financial institutions that provide banking and other financial services.
The name bank derives from the Italian word banco “desk/bench”, used during the Renaissance by Florentine bankers, who used to make their transactions above a desk covered by a green tablecloth. A bank is a government-licensed financial institution whose primary activity is to act as a payment agent for customers and to borrow and lend money at differing maturities. It is an institution for receiving, keeping, and lending money at interest.
The main services of the bank include providing checking and savings accounts, lending money to companies and people, facilitating money transactions, online banking and many others. There are two main transactions – money deposits and withdrawals. The banking terms “deposit” and “withdrawal” tend to obscure the economic substance and legal essence of transactions in a deposit account. By opening an account, you receive a checkbook and a passbook with your account numbers listed on them. People can also deposit a check into an account, but then they must endorse the back of it. If you are making a transaction at the bank, you have to bring 2 form of identification with you.
: SYSTEM OF BANKING: . -31: -2004- PLAN: Introduction... 3 Banking service... 4 Establishing a bank account... 5 Cashier's check... 6 The banks of England... 7 The banking system in Russia... 9 The conclusion... 10 The literature... 11 The translation... 12 1. Introduction My scientific work devoted to the analyses a banking system. In my talk today I will be looking at banking services and the ...
Today we have lots of different kinds of payments: we may pay in cash, check or with a credit card. When using a credit card for purchasing some goods, you should remember some rules. First of all every month you receive a monthly statement from the credit card company which include billing date (the date the statement was prepared), the balance (the amount you owe) and the due date (the date by which you must pay).
But you may pay a part of the balance and owe the rest, then you will incur a finance charge.
Management of personal finance implies an individual’s ability to effectively utilize
personal fund to provide for his or her needs. Human needs are insatiable and therefore effective management of the available financial resources is essential to take care of priority needs. I support Asaolu and Nassar’s point of view as to the management of personal finance. They said that it should involve the following:
• Planning: Individuals should be able to formulate policies and develop financial plans for the distant future.
• Organizing: Individuals should keep track of the financial implications of the various activities they are embarking upon. They should be able to keep abreast of the development within and outside their environment and take advantage of its strength and opportunities.
• Decision making: Based on the analysis of relevant costs, presentation of quantitative data, and qualitative, the individuals take decisions.
• Controlling: Through the establishment of cost and financial control and analysis of variance (i.e deviations from plans) the individuals decide on the actions to take,
The process of creating a detailed plan to meet your financial needs and prepare for the future is called b. personal financial planning. 2. Which of the following is not one of the five major steps of the financial planning process? c. collect and organize your financial information 3. Which phase in life is commonly associated with focus on marriage, family, purchasing a home, and career ...
• Communication: Through the production of accounting reports and records the individuals should keep their lenders informed of the positions of events,
• Directing: Proper keeping and maintenance of financial records give adequate guides to the individuals,
• Budgeting: This is the preparation of statements that formalize plans. The individuals strive to translate these plans into action. Personal finance budgeting is therefore a preparation of statements which indicates that within a given period of one year there is an estimated revenue from which the years expenditure can be deducted. Budget is a periodical financial projection whose success is largely determined not only by ability to forecast income and expenditure correctly but commitment to strict implementation.
To sum it all up I would like to say that people in contemporary developed countries manage their personal finance with the help of banks that make people’s lives easier by providing people with different services.