If a person saves a particular amount of money each month, even a small one, the savings can help them to overcome a period with difficulties, when prices rise and inflation is high, Bianca Isaincu, policy analyst on financial literacy and sustainable funding at the Organization for Economic Co-operation and Development (OECD) based in Paris, stated in a financial education podcast of the series “Give sense to money”, IPN reports.
According to Bianca Isaincu, the people can protect themselves by the way in which they spend the money. When a person has a stable income, this is already a positive thing and the person should think how to maintain this income and to distribute it for needs and plans. Besides saving, the persons should avoid raising loans with very high interest which can have a negative impact when these loans accumulate.
She noted that there is the temptation to go and take out short-termed loans, but this is not good when there are financial difficulties. This can be a solution when there is a very pressing need, but it is anyway risky. “When we have a loan with a very high interest rate, this can regrettably become a rolling credit that leads to severe financial problems as we are unable to pay the interest rates. So, we must avoid such situations,” said the expert.
Bianca Isaincu also said that one should not believe that there are solutions that can help them to make a lot of money during a very short period of time. “Over the past few years, I also sawthat the people have been tempted to invest in crytocurrency, in new financial services that promise to yield a lot during a very short period of time. We must know that when someone offers or says that we can earn a lot of money during a very short period of time, this implies very big risks,” stated the expert, noting that returning to prudent management is the best idea.
The podcast was produced by the National Bank of Moldova together with the Organization for Economic Co-operation and Development.
