Brenda Weathers Hargroves
Financial Literacy: Why Now? My faithful followers may recall my first post discussed how entrepreneurship grew from a dirty word to its currently prominent status. Well, now it’s financial literacy’s turn to garner similar respect. In fact, April is Financial Literacy Month.
It’s about time for this recognition.
Lately, there’s no avoiding dramatic price increases everywhere you turn. The effect of high prices is currently the second most discussed family topic. People are struggling to pay rent, childcare services and keep food on the table. The situation has made it difficult for many to maintain a budget, much less save or invest. And I’ve never known the price of anything (excluding gas) to go down. At best, prices will level off. But I’m willing to bet what we’re paying before that happens will become the norm.
The extra money we’re currently forced to shell out is not the only reason to sharpen those financial skills. A survey conducted by the National Financial Educators Council found that in 2020 Americans spent $352 billion on overdraft fees, high-interest loans, and similar expenses because of financial illiteracy. The need to increase money management skills has become critical for future stability.
Better management of personal finances promotes lower debt obligation, higher credit scores, and increased savings. Not only for you, but for other family members as well, particularly children. We should teach young people to practice sound financial behavior as soon as possible. Long before they graduate from high school, they should understand the importance of saving, investing and what accompanies those free tee shirt credit card company promotions.
I was happy that Florida has embraced Financial Literacy Month this year by mandating that all high school students must take a financial literacy class in order to graduate. Learn more about empowering the next generation’s financial literacy skills here.
Self-discipline is the secret. But practicing self-discipline is not always easy. Many people struggle with this, especially when it comes to money management.
First, you must develop a clear picture of your future. What are your financial goals? Do you plan to someday purchase a home? Prepare for your children’s education or further your own? Establish long-term generational wealth? Or simply improve family stability? You’ve probably heard developing ‘SMART’ goals is optimal. Don’t know what the term means? Check out this video.
The next step? Create and stick to a budget that includes both needs and wants. And don’t forget, your budget is not written in stone. It should be a working document that allows for flexibility to make adjustments as needed. The most important thing to remember is managing debt is the biggest obstacle to achieving financial success. “I owe. I owe. So off to work I go.” Your number one aim should be to BECOME DEBT FREE!.
In his February 2021 article, Martin Dasko states self-discipline leads to a happier and healthier life. Developing good money management skills is a lifelong process that requires mastering this trait. How well do you practice self-discipline? And how committed are you to setting and achieving financial goals?
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