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Personal finances

Financial security is the most important thing in family finances. This is not the same thing as being rich; it means being freed from the need to think about money, living within your means. For day-to-day living you need ready cash but you also need a bit in reserve for a rainy day.

The first thing to think about is your current account and how much is in it. Our family, for example, keeps all of our money in a saving account with a bank. And all of us have credit card, because credit card is a helpful way of handling with unexpected expenses. But credit is always costly, and of course it's just another form of debt. For some people, however, living on credit is a normal way of life. There is a credit from suppliers, hire purchase and loans from banks are the forms of consumer credit. Our family also is not afraid to use consumer credit. We think that credit enables us to enjoy the use of goods and services before we have fully paid for them. And, of course, we are not afraid to use consumer credit because we have a constant income.

People earn money in different ways: they get an income from employment, from keeping money in a saving account with a bank, from renting property, from investing in shares in the stock market. For example our family income comes from different sources. The largest source is my parent's employment and return from their savings. Also we have a little income from investing in shares. Nearly all money goes on rent, utilities, transport, clothes and food. Our income is not large, we a middle-class family.

 The worst-off people are the unemployed and the homeless. For people living at a subsistence level even buying essentials is a struggle. They sometimes take out loans, borrow money from banks, but very often they are unable to cope with repayments. Banks are not willing to lend money to such people.

My personal income is not large, but it is enough for me. My parents give me a pocket money and I get a grant. All my income I spend on leisure and entertainment. I try to be punctual about my finances, but sometimes it is very difficult for me and I don't do it well.