A1 Role of money Flashcards
What is the role of money affected by?
Personal attitudes
- Life stages
- Culture
- Life events
External Influences
Interest rates
Why is culture affected by role of money?
Affected by tradition, religion, ethical beliefs will have different attitudes to money.
Why is life stages affected by role of money?
As you grow up (childhood- adulthood) your financial needs change.
Why is interest rates affected by role of money?
Interest rates low = more willing to borrow money or credit.
Interest rates high = People incentived to save.
Why is personal attitudes affected by role of money?
Individuals will vary attitudes to risk, rewards, savings and borrowing.
- Risk- taking risks, enjoy risk taking, or incentivized by potential rewards.
- Saving- May be influenced by family to “save for rainy day” or just want to.
- Borrowing- live “within their means”
Why is external influences affected by role of money?
Factors that are out of your control (state of economy)
- May effect wages, job availability, price of goods and services.
- Decisions made by the government will affect the amount of tax you pay, amount received in benefits, affects ability to spend and save.
Why is Life events affected by role of money?
Life events will impact your life on attitudes to money.
- Within control: university, getting married, starting a family.
- In control: illness, financial gains or losses.
