Financial Management: Flashcards
What Is The Importance of Financial Management:
Acquiring, saving and growing the necessary funds to live a full and satisfying life, now and into the future, requires planning and management.
Moral of The Fable of the Cicada and the Ant:
Manage your finances so you will be prepared for emergencies.
How does The Fable of the Cicada and the Ant relate to the importance of Financial Management?
It relates to the fable because in the story the cicada didn’t prepare for the winter while he was being given advice by the ant to stock up for the winter. It relates because in real life if you don’t take real, helpful advice from people in real life, and you think that everyone will do things for you. If you just sit back and wait for things to come without doing any action then you aren’t managing your finances. This can result in debt or even going bankrupt.
Individuals managing their income and savings are faced with similar decisions as faced by the cicada in the fable.
Is the task to enjoy life now with no consideration for the future? Stockpile funds in preparation for future necessities? Invest savings to capitalise on potential growth, or a combination of these?
Your approach to financial management is a personal one. However, if you make poor choices, the consequences can be like those of the cicada in the fable; you may not be able to satisfy all your needs and wants.
