Financial Education for companies - basic course

Financial problems accompany not only the unemployed but also the employed. The situation is particularly critical in manufacturing companies, where many employees often have only basic education. How to solve the situation? Experts agree on one thing: "The most effective long-term solution lies in increasing the financial literacy of the population so that they do not fall into unnecessary debt traps," says Petr Polanský, a member of the presidium of the Chamber of Executors of the Czech Republic.

Causes of reckless indebtedness

The most common cause of unhealthy debt is an unexpected reduction in income or a sudden one-time expense. People often live from paycheck to paycheck, and if there is a decrease in income (sickness, job loss, parental leave) or an increase in expenses (necessary car or household appliance repairs), the family budget cannot withstand the situation. When a person finds themselves in an unpleasant situation, they often become nervous and make many mistakes that lead to further unnecessary problems. Unnecessary loans are also a common mistake.

The biggest mistakes made by debtors

The biggest mistake is to play possum. People don't have the money to pay the installment and are afraid. Therefore, they don't answer phone calls, don't open letters, and wait until they get the money (a loan from family or friends, extra earnings, the next paycheck, etc.). This is the worst and unfortunately a very common approach of debtors. The situation needs to be addressed proactively, directly with the creditor. It is possible to agree on a deferral of payments, temporary reduction in the amount of the installment, and so on. Once the dispute reaches the stage of judicial enforcement or execution, the amounts grow disproportionately, and the debt is collected in full. If execution does occur, it is necessary to try to communicate directly with the executor and arrange the most favorable repayment schedule.

The solution lies in practical tips, but primarily in prevention

Several entities can help resolve the critical situation. The consequence is addressed by citizen advisory services or advisors who help debtors apply for personal bankruptcy. Unfortunately, among these individuals, many scammers can be found who, under the promise of resolving the situation, try to seize all the remaining assets of desperate debtors. One of the organizations that has decided to fight against debt problems is the non-profit organization Center for Financial Literacy (CEFIG).

The path to corporate training is described by Ondřej Podlešák, the director of CEFIG. "When we established our organization, our primary target was students from elementary and high schools. However, training for employees of manufacturing companies has become a significant part. Courses in financial literacy are in demand directly from HR managers and business directors. Employees who have problems with debts or executions often see no light at the end of the tunnel. Demotivated workers are not as productive and, at the same time, add to the workload of the payroll department, which has to deal with creditors. Some training clients even claim that up to half of their employees are facing execution - no wonder, the number of people in execution in the Czech Republic is approaching one million."

The training itself, of course, does not solve the problem. However, it provides valuable advice to debtors on how to get rid of debt problems more quickly and provides a guide to successfully resolving problems. Participants will become familiar with the most common causes of reckless indebtedness, which include inadequate financial reserves and unnecessary loans for vacations or Christmas gifts. At the same time, the course also serves as prevention, especially for the younger generation.

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