April is National Financial Literacy Month
Did you know one-in-five Americans with lower incomes report they “don’t know much” or “know nothing at all” about personal finances? Without proper money management skills, it can be difficult to plan for big moments – like buying a house, saving for retirement and even establishing a monthly budget to keep spending on track. As we enter National Financial Literacy Month, now’s the perfect time to review your finances, set goals and expand your knowledge about money management!
What is financial literacy?
To put it simply, financial literacy is the knowledge and ability to manage money. From earning and saving to budgeting and managing debt, financial literacy is essential to making fiscally responsible decisions.
Why is financial literacy important?
Money affects all aspects of our lives. Food security, housing, transportation, relationships and more are all directly impacted by our finances. When we understand the basics of financial literacy, we can set and reach long-term goals. A lack of financial literacy can lead to overspending, which directly impacts our daily needs.
How can I improve my financial literacy?
- Track your spending. The best way to grow your financial literacy is to learn as much as you can about your personal finances. An easy way to start is by evaluating your recent bank statement. Take a look at how you spent your money and sort everything into categories – rent, food, subscriptions, bills, miscellaneous, etc. Once you have your categories, you can then…
- Create a budget. Budgeting is a great tool to ensure you’re on track to achieve your financial goals. Once you’ve tracked your spending, you can use this information to create a budget that fits your lifestyle. Ensure major expenses, like rent, utilities, food, outstanding debt and other bills, are at the top of your list!
- Set aside emergency funds and save for the future. Once your bills are paid, you can set aside funds to save for emergencies, retirement or a big purchase. This sets your future self up for success!
- Take advantage of free resources. There are countless courses available for you to grow your financial knowledge. And several are free! The Memphis Public Library’s Personal Financial Center is a great place to start. Plus, they offer resources for kids, too!