Why Do Many IT Professionals Find Themselves Struggling With Finances?
If you search online for the highest paying jobs worldwide, you’ll surely find professions like Data Scientist, Software engineer, and Business Analyst popping up on your screen as the topmost money-generating professions in the tech industry. As the world is going gaga over technology, IT professionals globally are seen grabbing significant packages straight out from colleges/universities.
Knowing this, I am sure you must have imagined them as individuals who earn enough to cover their expenses and can peacefully retire in their 40s. What if common reality is much more convoluted than this? IT people often get stuck with their finances and it is observed that it’s not about their paychecks, nor the economy to blame, the real culprit is – lack of financial literacy.
Unfortunately, they Google everything they need to work on their projects but very few searches are made by the developer fraternity to search for good options in investment, tax saving strategies, and how to plan retirement. This only has been the root cause behind their eco-health, where eco is not ecological but economical health
Below are some of the reasons I explored in my 4 years of working in a company full of techies and very few financial managers.
- Gotta buy gadgets or eat outside often? Or plan smarter?
The prime aspect that can be considered as an indicator of lack of financial difficulty among individuals is having no plan regarding their spending budget. Operating finances without a budget can let individuals loose on spending habits and further lead to a debt trap that affects not just them but everyone. Many IT professionals don’t believe in the idea of calculations and never bother about monitoring their money, failing to reach financial stability.
- The good-old trap of Overspending
The lack of planning of expenses leads to a financial rut- Overspending. 52% of Americans are spending more than they earn and are slowly, steadily heading towards getting broke as per the Bureau of Labor Statistics. It feels very frustrating to struggle with money even after achieving decent pay and dealing with situations emerging due to not having enough money.
We live in a generation that finds gratification in spending things contributing towards a luxury lifestyle. Many individuals fall into the trap of buying expensive and unnecessary purchases in the early phase of their careers. Social media have also actively contributed to impulsive purchasing, where many individuals compete with their peers to stand out in their online community.
- Huge Dependency on credit cards
Lack of planning and overspending sums up borrowing and putting individuals towards using credit cards for expenses. The easy and quick availability of credit cards has given rise to many individuals using credit cards to cover their monthly spending. Using Credit cards doesn’t seem to be a problem, but their usage can gradually discourage self-control and lead to worse situations in case of not maintaining the streak of payments.
- Investment is not just for the Richie-rich, it’s for everyone
Most young individuals have a false feeling that investments are only meant for rich people and are a complicated process. The reality is, investing is perhaps the most crucial practice one can do at any stage of their life to ensure present and future financial security.
Can you (a financial manager) make it easy for your colleagues?
Surely you can. Despite having elite education and complex project handling, financial literacy is tricky for this bunch but it also has been an overlooked topic by many educational institutions, and trainers. A number of working professionals find difficulty in making personal choices centered around investing, saving, credit, and similar aspects. To make it simple for your colleagues, think of this as a software problem and provide solutions. Interested?
Some financial components that IT professionals should know but don’t are:
- Budgeting: Plan the story of this year
Budgeting and saving constitute an important part of financial literacy programs as it revolves around adopting the method of spending and controlling expenses. Through budgeting, participants can learn the art of making financial decisions that can help in emergencies and achieving financial goals.
- Taxation: Mandatory ones and shortcuts to save this toll
Many individuals pay taxes as per their incomes earned but still find themselves perplexed in understanding the calculations and purpose behind it. Being a crucial element of finance, everyone should learn the taxation system while understanding the ins and out of finance.
- Investments: Execute it in sprints per month, so you don’t get burdened
The days are gone when depending upon savings was enough for financial security. In today’s changing times, it’s important to make the money made by your work for you rather than simply letting it stay in your bank. As investments can be risky and result in losing all hard-earned money, individuals should be given proper training that can make them understand different investments and invest their money in the right direction.
The importance of financial literacy cannot be ignored and should be emphasized by organizations to relieve their individuals from financial stress. To spread awareness among our people, we are planning to organize an insightful session for both seasoned and newly joined colleagues. In the session, we’ll be giving our best efforts to resolve the queries of our colleagues and make them understand the fundamentals of finance. If you like our ideas, and have any other ideas after you faced the same challenges with your teammates, write to us below firstname.lastname@example.org
Written by Sarvika Technologies
Sarvika Tech is a team of young, energetic, and technology-loving people on the journey to help companies achieve their goals by supporting their IT needs. In a nutshell, we are a people’s company where the priority is their knowledge enhancement and career development. We believe that focusing on our most important asset, the team, will enable us to push boundaries and deliver ingenious IT solutions.