End your year how you plan to start your next.

So what is it to be Financially astute?

We are talking about those with more modest means who make the most of their money. … To make the most of their wealth, the financially astute may consciously or unconsciously hold onto a set of money management principles that protect their wealth and ensure that their money is working as hard as possible.

1. They borrow wisely

Not all debt is bad debt know the difference between good and bad debt.

2. They control their expenditure

Temptation to follow ‘I can have it now” world we live in. For example, you could walk into a car showroom today and drive out with a brand-new car. How tempting is that? The difference between the financially astute and the financially inept is discipline.  The financially astute are also tempted but know when it is right to say NO to themselves. Learning to keep your desires under control can make a huge difference to your long term financial position and goals.

3. They have a plan

A strong financial position takes years to build and like any building, takes design, planning and execution to become a reality

Few people end up in a strong financial position by accident. The financially astute understand that trying to do it all themselves may be unrealistic and would happily pay an expert to help them with the most difficult parts of the plan; the design and planning.

4. They put their money to work

Getting a decent return on your savings is difficult in this low interest rate environment. That’s no excuse for leaving your hard-earned cash in a savings account that doesn’t keep pace with inflation. Rainy day money is one thing but anything longer term should be viewed with a discerning eye. With their financial adviser, the financially astute would find a better deal for their cash and would assess the viability of investing some of their savings in risk assets like stocks and shares for a potentially better return.

5. They own their property

Every young person paying rent probably aspires towards owning their own property. With house prices increasing, property ownership is no longer a right, but a privilege, and saving for a deposit whilst paying rent is easier said than done. The financially astute would accept that successfully getting onto the property ladder was a huge challenge and would need careful planning, consideration and the assistance of an expert.

6. They insure what they value

What are the most valuable things in your life? Are they material things like your home, contents, car or bike? Or are they your health and ability to work? What about your life itself? What’s it worth to someone else, perhaps someone who depends on you financially? The financially astute would prioritise and insure what they value.

7. They invest – in themselves

Learn before you earn and set goals

Increasing your ability to earn through learning is often overlooked but could go a long way towards boosting your value in the marketplace. The financially astute understand that becoming financially secure is a lot easier when you earn more; more importantly, investing in yourself should give you the self-confidence to know your worth and to ask for what you deserve.