Personal finance is just another theory @finnovation

Written by Michal Kisiel Thursday, 27 October 2011 21:58
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In at number 6, to answer the question ''What do we fail to teach our kids about money?'' is Michal Kisiel.

Over to you Michal...

Are we getting financially lazy?


As a part of my academic duties I teach a "Personal Finance" course for postgraduate students.

Every semester I stand in front of a few hundred young, bright people and ask them a question - "Are you tracking your expenses in any way? Please raise your hand if you do".

And every time there are only few hands raised.


They are the future finance professionals - bankers, accountants, traders. They will manage others' people money and they have worked hard for 5 years learning the ''ins and outs'' of finance. They might be able to describe the most complex stock options investment strategies, but they do not know how much money they spent last month.


Money is getting virtual, intangible.

Credit is easy to get.

Managing money, on the very basic, day-to-day level, was less complex for our parents, raised behind the Iron Curtain, than it is for us now.


On the other hand, we are not pressured to control the money - if we can live comfortably with what we earn, sticking to the budget is not a matter of life and death.

The lack of necessity for managing everyday spending makes us all "financially lazy".


I am convinced that everyday financial choices are as important as "big" decisions such as getting the mortgage or selecting the pension plan.

They affect our financial wellbeing, only less visibly. If there is one thing I would like my students to try it would be to fight the laziness, make an effort to control the money. Go online, try that PFM tools, track your spending for few months and learn a few things about yourself. Getting  financial self-consciousness is the first step to rational money management.

Without that ingredient, personal finance is only theory.

Michal Kisiel is an economist and assistant professor in Wroclaw. He is also an analyst @ Blogging about financial innovations - e-banking, payments, social lending, social investing @

What we fail to teach our kids about money by Andy Golding and Annie Shaw will be published by Searching Finance in December 2011.



Last modified on Friday, 28 October 2011 08:11

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