IAB Fastens Seatbelts in Flight over the Horizon’s second lecture
A series of lectures is being held at IAB between April 7 and 30 as part of cooperation between the bank and the university under kaspi bank’s initiative About Finances in Simple Terms.
A. Yemeshev's lecture
Aleksander Yemeshev, the bank’s top manager, started off with a food-for-thought statement.
“Our bank’s survey has shown that one in two people in Kazakhstan doesn’t keep track of family finances. This means that these people, in effect, don’t think how much they can afford to spend, how they might want to spend their money and they don’t know how much they will have left in a month or two.”
Furthermore, Aleksander Yemeshev added that the survey had highlighted that 63% of their respondents (two-thirds of the surveyed) lived hand-to-mouth and didn’t have any savings. That is, their incomes are equal to expenditures, forcing some to borrow from friends, relatives or banks.
The speaker said that very often the root-cause of the problem lay in …mind and in poor planning strategies.
“How do you personally evaluate the standard of life? How would you determine a person with the best quality of life in this conference-room? Normally, we use simple techniques. We base our opinion on the kinds of restaurants or cafes people go to, the car-makes they have and their clothes. Thus, we assess income through expenditures, thinking that spending is an accurate reflection of one’s incomes.”
Based on this example Aleksander Yemeshev said that banking practice had shown a few basic but efficient tips could help people have a better standard of life, even if finances are scarce. First off, he advised it was better to focus on one’s personal incomes and expenditures, instead of concentrating on other people’s buying habits. “To do so”, - he said - “it was important to make sure that incomes were higher than expenditures.”
He also recommended that cost-effective alternatives were considered as first choices in most circumstances. His other advice was that spending should not be mere waste of money.
“You should not just spend money. You should invest it. In principle, when you consider your income and expenditures your decision should take account of not just the money that you cough up, but also the payback.”
The next lecture Take-Off is due on Apri, 24. It will deal with potential questions over terms and conditions in banking agreements.
