Why You Should Learn The Basics Of Finance At Work

In business, finance or accountancy is maligned as "boring", but if we think about our own bank accounts, savings and investments, money suddenly becomes a lot more interesting! It's easier to dismiss our employer's money - except the payslip that arrives every month - because it's not our own, so we have less motivation to understand what's going on in the bowels of the businesses' finances. However, learning about finance not only helps the company you work for (especially if it's your own), but it can improve your skills in many different directions, making you an all-round better employee.

Reason 1 - You can set targets with cost in mind

If you always leave the end-result or project goal to someone else, it's time to change that by understanding finance better. Nearly all work projects or tasks revolve around how much it's going to cost: even down to the business itself and how many employees - including you - are going to take home a pay, and how much. If you've improved your financial knowledge then you can be the one to set targets, to hire and fire a team based on how many people you can afford to payroll, and start to plan bigger projects because you have the skills to start with the end in mind.

Reason 2 - You will gain greater budget control and understanding

As they say, money makes the world go round - and controlling it effectively is the single most important thing in business. You wouldn't hand someone your wallet, not knowing how much is in it, and tell them to spend whatever they like to complete a given task, otherwise you'd be broke pretty soon. It's the same in business. Understanding balance sheets, profit and loss and cash flow are all small steps to understanding budgets better, and see the warning signs if a budget is too high or won't be sufficient to get the job done;.

Reason 3 - Improved negotiation and savings skills

If you hone your finance skills, you will start to realise what elements of the business cost what, so you can look for savings in the business process. There is nothing that an interview panel likes to see more than "saved x company x amount in x time" on a CV. If you can cut costs - you're onto a winner, and you can't do it without first understanding finance. In addition, you will be able to improve your negotiation skills by asking for discounts from suppliers for bulk orders, for example, or will be able to look at other options to meet objectives for less.

Reason 4 - Expanding financial knowledge opens up more jobs

If you lack financial understanding and always leave it to other people to interpret a budget, set cost parameters or negotiate prices, you'll probably never make it to a more advanced career such as project management. Anyone who has greater responsibility has to have keen financial skills. You don't have to become an accountant - you don't even have to understand more complex financial instruments, but you do need a solid knowledge of the basics - and this will enhance your next career move no end.

Financial knowledge is one of the basic cornerstones of a skilled employee. If you take some time to train up your financial knowledge, it will literally pay you back, no matter what your job.