Take time to improve your financial literacy

It’s a basic life skill necessary for future success, but unfortunately, it’s something far too many people struggle with: financial literacy.

April is National Financial Literacy Month, a national campaign organized by the Jump$tart Coalition to raise awareness about financial literacy and promote financial education. It’s an excellent opportunity to review and upgrade your financial smarts, because whether you’re just starting out or have been earning your way for quite some time, it’s never too late to learn about saving and improving your financial outlook.

According to a report from the National Financial Educators Council, 18.7% of individuals in a recent survey said their lack of financial literacy cost them at least $500 in 2023, including 8.83 percent who said it set them back by $10,000 or more. The majority (39.42 percent) of respondents said poor financial literacy cost them somewhere from zero to $499. The average cost was $1,506.

For those wanting to upgrade your money management smarts, the Credit Counseling Society offers the following tips for making budgeting easier:

• Use Real Numbers — For a budget to work and be successful, it needs to be based on actual numbers and not estimates of what you think you’re spending. Knowing how much money is coming into your household and exactly how much is going out every month is key in creating a successful budget.

• Give Every Dollar a Job — Budget to zero every month — track every dollar you earn and give it a job in your budget. If your fixed exposes, debt payments and savings have all been paid for and you’ve still got money left over, give it a job so it doesn’t disappear by accident. You could add it to savings like retirement or emergency funds, make an additional credit card payment, or give yourself an increase in your discretionary spending.

• Set Goals for Your Money — Write down your financial goals and review them when there are changes to your situation, such as when your income goes down, when it goes up, or when a debt gets paid off. Be realistic with your goals and timelines because they will impact your budget.

• Separate WANTS vs. NEEDS — When creating a budget, you’ll need to account for all your expenses. When reviewing your expenses. When reviewing your expenses, consider which ones are wants and not needs. Spending too much on wants can add up to a lot of debt very quickly.

• Plan for Irregular Expenses — People often forget about those expenses that only come up once in a while. Irregular expenses might include things like car repairs, haircuts, vet bills, membership fees, gifts, festivities, or even clothing.

• Pay Yourself First — Treat your savings like an expense or a bill and put it in your budget as a regular “payment” instead of waiting until you have money left over to put away.

• Create an Emergency Fund or “Buffer” in Your Budget — Put a small amount of money into a separate savings account every pay period to build a fund for these situations. A little extra money set aside can turn most emergencies into just inconvenience.

We encourage everyone to take some time this month and brush up on your financial knowledge because financial literacy is paramount to your success.