But how do parents to explain all this to their children of secondary school and outstanding of fashion? And what of adolescents with their dreams of attending a university outside the state or have a new car?

What to say

Be honest with their children, but not told more than they need to know. Avoid burdening older children with too many details or concerns that could scare. Provide brief explanations and is clear with regard to the changes that suffered the family budget.

Even the youngest children have brand awareness and consumption in these days, so do not expect voluntarily lower the level of their tastes or activities immediately. But if wants to promote a conduct budget, incentives for children to enable them to participate.

If it is clear what to say, the changes that will be produced and how these changes will affect children, this task will be easier.

Apart from teach your child as making money, do you is providing the necessary skills to manage and invest the money once you have in your hands?

All of us as parents want our children to succeed in life and we focused to give them an education for that may have insured its future financial situation.

The most important is to learn a trade, so they can insert in the labor market with the security of a good salary. Do you?

Not necessarily a good financial situation requires two things:

1. Know how to generate an income

2. Know as handle once it is in our hands.

The traditional education plays pretty well with the first point, but fails sadly in the second.

It is to look around us. The financial status of the vast majority of people today, independent of their income, is deplorable. The majority of our monthly income is already spent the day that are received, due to the level of indebtedness that we have.

In the same way in which we educated to generate income, we are also conditioned to spend and live beyond our possibilities.

The sad outcome becomes more evident in times of little economic stability as it is today. In the middle of the world crisis we are faced with a high level of debt and little or no investment accurate for our future. Or talk of which are grappling with the problems of unemployment.

Face the reality: we poorly prepared for our retirement.

What fail?

The answers of these are in our financial education. The vast majority of people today are illiterate when it comes to basic principles of money management. We have been educated to work in a job and rest in the apparent security of a salary, but we don’t know as invest our money wisely, how to generate passive income nor as exploit our individual talents to generate money through them.

Apart from trying to solve our financial situation, the question today is how we can prevent this same will happen to future generations? Are you prepared to their children for the workplace and les these providing further financial skills necessary to handle the money so it may face the times of unstable economy successfully?

The problem is that, even if we would make a change in the education of our children, we cannot do because we do not have the answers. We are the result of a system of education not taught us the secrets about how the money.

However, once aware of the problem, we are in a position of power search for solutions. If we want to make a change in the financial education of our children and handing the knowledge and skills necessary to enable them to leave home and be financially free, we will have to take the nettle and implementing major changes in the manner in which the educate today.

The flow of capital

In the world micro, the flow of capital that a company receives is determined by the law of supply and demand: the more produce and will make profitable a company, the greater the flow of capital which receives and the greater the flow of capital to invest.

The flow of capital for a company is composed of assets and liabilities, the values that are owned and the money is spent to keep the chain of production.

Among the assets are: the capital of the company, the credit and loans and the capital of external investors (or shareholders), and (mainly) what clients pay for goods produced by the company. The latter is, without a doubt, the flow of capital more relevant.

Among the liabilities are subtracted the payment of interest by the payment and cancellation of loans, the payment of dividends and profits to investors, purchases from suppliers and expenditure on inputs, investment in equipment, training and salaries of staff… a profitable company obtained as a result of its flow of capital, a positive balance in the assets.

The flow of capital is, in itself, a definition of the role of a company: obtain wealth to generate new wealth.