Managing a personal budget is among the fundamental knowledge of good financial management, claim financial experts. In recent years, the Croatian Banking Association has launched specialized workshops where personal finance management is taught.
writes Kata Pranić
[email protected]
Do you know how to save? The answer to that question is not as simple as it seems and does not mean that you can just go to the bank and deposit money into an account or pay for life insurance. The greatest financial wisdom, besides knowing how to invest, is knowing how to save, or rather learning to save. Not only those who have enough money save; after all, few have as much as they need or would like to have. Saving is learned like everything else, and it should never be equated with stinginess. Learning to save means having control over personal finances. For that, willpower and self-discipline are primarily needed, especially for those in debt. Debts are not only a path to financial ruin but also triggers of stress that, if prolonged, endanger health. Only when debts are paid off – and we do not mean the small ones, but the debts accumulated on numerous credit cards or multiple short-term loans – can one start saving seriously. However, before embarking on organizing finances, it would be wise to seek professional advice. Managing a personal budget is among the fundamental knowledge of good financial management, claim financial experts, and in recent years, workshops organized by the Croatian Banking Association have been held in Croatia where personal finance management is taught.
Intersectoral Cooperation
– At 212 interactive workshops held for citizens so far – for example, ‘How to Align Income and Expenses’ which are held within the project ‘Managing Personal Finances’ – from those held in 2006 to today, 1,650 participants have attended. The impressions of the workshop participants are very positive, and almost 98 percent stated that they would recommend the workshop to someone, mostly friends and colleagues at work – says Martina Etlinger, an advisor at the Croatian Banking Association. The project of interactive workshops for citizens is jointly conducted by the Croatian Banking Association and nine member banks: Banka Kovanica, Erste&Steiermärkische Bank, Hypo Alpe-Adria-Bank, Međimurska banka, OTP banka Hrvatska, Privredna banka Zagreb, Raiffeisenbank Austria, SG Splitska banka, Volksbank, and Zagrebačka banka. These workshops are a unique example of intersectoral cooperation in which banks invest in the community and jointly raise the level of citizens’ knowledge on such an important topic – personal finances. Those who do not have time to attend workshops can learn to manage their finances via the internet at the web address www.hub.hr/uof.
Income and Expenses
– The goal of the workshops is to encourage citizens to manage or plan their finances, personal or household, to recognize their needs, desires, possibilities, and goals in order to achieve them in the short and long term. During the workshops, there is a complete absence of any offering and promotion of bank products and services. Our resources are knowledge and information, and we want to convey that to citizens. Because today, when the offer is rich and diverse, it is necessary to be well-informed and possess certain knowledge so that we can make relevant decisions every day. This is one of the first steps towards success. It is important to emphasize that the workshop is not a financial advisory service, but we want to enable citizens to see possibilities and make decisions aimed at changing certain habits and behaviors, all for a better and safer financial future – explains Martina Etlinger. Following the example of the HUB’s personal finance management project, banks in Serbia have developed a very similar workshop model under the auspices of the Global Compact.
– Citizens at the workshops receive advice on how to analyze the current situation, i.e., to record and track their own spending habits over a certain period. It is always important to take care of the household budget, and this is crucial during a recession. In order to even think about saving or investing, we must check the state of our household budget. If we are not in the black, by managing the budget we can try to achieve a surplus of funds. It is crucial to reduce expenses or increase income so that one day we can save or invest – explains Martina Etlinger what can be learned at the workshops. The Croatian Banking Association will announce the dates for free workshops for citizens on managing personal finances at the end of October. However, alongside the workshops on saving, those on investing will also be added, so potential investors will gain new knowledge.
– We need to be aware that without knowing our own financial situation, which is achieved by managing a budget, we cannot know for sure what we are spending on. No matter how much we earn and how much we think we know what we are spending on, we need to know where our ‘financial space’ is and what it looks like. We often say that we have the feeling that money is slipping through our fingers. Sometimes changing some purchasing or spending habits is the best way to save. It is necessary to stay informed as products and services change, both financially and otherwise – says Martina Etlinger.
