Financial literacy is a topic that is often overlooked, but it is something that everyone should take the time to learn. After all, your financial future depends on it! Here are three of the most important financial literacy lessons everyone needs to know.
1. Money is an emotional topic for a lot of people
We don’t learn how to manage our money in school, and we’re often too embarrassed to ask for help. This can lead to a lot of financial stress down the line. But it doesn’t have to be that way.
There are numerous free classes available that focus on debt reduction, saving, understanding your money rights, and banking essentials.
In today’s digital world, you can even google it and find a variety of programs or forums where you may learn from others’ experiences and take your own steps toward financial freedom.
2. Understand the difference between good and bad debt
Most adults think that all debt is bad debt. But, what about a mortgage? How many people do you know who bought their first home in cash? A mortgage, as long as it’s within your means, is generally considered good debt. It’s the kind of debt that you pay off slowly and steadily, adding to your good credit, showing creditors that you’re responsible with money.
Debt is a problem. That’s the credit card debt we accumulate when we live beyond our means. Using your credit card to pay your bills, buy groceries, and so on is healthy debt as long as you pay it off in full every month.
I understand that this appears to be a simple task. I’m embarrassed to admit that I didn’t know about it when I first learned about financial literacy.
3. You’re probably heard of the saying, pay yourself first
But what does that actually mean? And more importantly, how can you do it without feeling the pain of every penny leaving your account?
‘Paying yourself first is a simple and painless way to save and invest. By setting up auto-deposits from your bank account each month, you’ll be able to bypass the pain center of your brain and save without even noticing.
We all know that money can be a tricky subject for some people, but it’s important to talk about the reality of finances. I’ve found myself feeling more confident and trusting in my decisions when learning how to manage them financially with adult learners around me!
I hope you will take this as a sign and continue researching financial literacy that could help you build your financial freedom. Please share this blog post with your friends, family, and social media networks so they too can benefit from the information contained herein. Financial education is key to creating lasting success in any area of life, including our finances.
If you know someone who could benefit from these lessons, please share this blog post with them. Financial literacy education is key to a bright future, and together we can help make sure everyone has access to the information they need.