What Is Financial Capability?
Financial capability is the ability to manage one’s finances effectively. It involves making informed decisions about how you use your income, budgeting for regular outgoings such as rent, bills or food shopping, and keeping a record of all financial transactions made each month. The aim of having financial capability is to ensure that it is possible to make ends meet without needing further assistance from external parties or getting into unmanageable debt.
How Do I Find Out How Financially Capable I am?
To assess your financial capability, it is essential to keep track of all costs and expenditures incurred during each month by creating an accurate budgeting plan. This can help identify any unnecessary expenditure and determine where savings could be made so that money can stretch further over a given period of time. In addition, it’s important to ensure that sufficient funds are kept aside for emergencies so that if something unexpected arises then there are resources available with which to cover the cost; this helps prevent the need for further borrowing which can quickly get out of hand if not managed carefully.