According to the Cambridge Dictionary, financial literacy by definition means “the ability to understand the basic principles of business and finance.” In layman’s terms, we are talking about being savvy about managing your money.
Without a doubt, everyone from children to adults needs to have these basic skills. It’s apparent that many in the banking and investment world want to intimidate us into believing that only they have the keys to understand how to manage our money.
In the most basic of terms, there are really only three main components you need to improve your financial situation. Within these three components, the personal finance aspect takes over, meaning everyone will manage and spend their money differently.
Budgeting is simply the process of understanding how much money is coming in each month and how much is going out each month. With this understanding comes direction and an ability to actually control your money, rather than your money controlling you.
Investing is usually the most misunderstood and scary part of financial literacy. Investing involves using your money to make money. In reality, investing is one of the easiest components of being financially literate.
1. Start With A Financial Literacy Month2. Study Up On Basic Financial Concepts3. Educate Yourself About Debt4. Learn About Real Estate5. Pursue Self Study6. Take A Class7. Talk With A Professional8. Learn About Savings And Investments9. Learn About Retirement Planning