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National Financial Literacy Month: 10 Practical Tips for Money Management

US currency coinsApril is declared as National Financial Literacy Month in the United States. Since 2004, the nation puts a spotlight on the importance of financial awareness and proper money management during this time of the year.

According to different researches and studies, financial awareness remains to be a main issue for a lot of people across the globe, including Americans. A survey conducted by S&P Rating Services revealed that only one in three adults around the world are financially literate. More so, results show that only 57% of US adults are financially literate.

Another survey, The 2015 Consumer Financial Literacy Survey by the National Foundation for Credit Counseling (NFCC) found that one in three has credit card debt every month, 30% are not confident about retirement savings, and only 40% of US follow a budget and keep track of their expenditures.

Taking Part in the Advocacy

Different organizations are holding different activities and rolling out various resources in participation of National Financial Literacy Month.

For instance, The Council for Economic Education organizes events for the whole month of April, all of which are in-line with financial awareness. For this year, they are doing a #MySavingStory Video Campaign which aims to raise awareness among children about the importance of having control over their financial lives.

The Financial Educator’s Council also participates in the advocacy by providing resources such as guides, tips, and materials to help people organize their own National Financial Literacy Month event.

Money Management International, meanwhile, launched a 30-day program called Thirty Steps to Financial Wellness. They also have tools such e-books, posters, fact sheets, and news release that encourage and help others to get involved.

 

How You can Participate: 10 Ways

Participating in Financial Literacy Month is not just about large-scale events and forums. You can join the advocacy with a simple step such as raising your awareness about important financial practices and proper money management. Here are some of the practical and timeless ways of managing your finances that you can focus on not just this month, but all year round. Let’s look at each of them.

  1. Create a budget, keep it realistic, and stick to it.

Creating a budget is a way to organize your money according to different expenses you have in a particular period, typically a month. More than that, a budget can help you save more and maximize your money.

However, a budget will only be as good as how you follow it. Keep in mind that it should be realistic enough so that you can stick with it. Allot money for expenses like travel and leisure, so that you can also enjoy some of the money you’re earning even while you’re saving or working on a financial goal.

  1. Treat savings like an expense.

Each time you receive your paycheck or income, always set aside a portion of it for your savings. Savings shouldn’t be what’s left after you have spent your money on different expenses. It should be the first area you should allot money for.

One way you can prioritize savings is to automate transfers from your payroll account to your personal savings account. This way, money will be put away in your savings account even before you receive your pay.

Tip: Once you set aside an amount for your savings, think of it as money already spent, so that you will not be tempted to tap it as a money source for impulsive buys and unnecessary expenses.

  1. Manage your debt.

Having debt is not generally a bad thing, but it becomes harmful when you fail to manage it.

If you have on-going debts, take an inventory of them in order to determine which ones you need to pay off first. It’s advisable to prioritize debts that are tied with high interest rates. In addition, consider talking to your lenders or the people you owe money from. Try negotiating for an extension of your due date or a less stringent penalty fee if you think you can’t settle on time.

  1. Track your spending.

To manage your money well, you need to know what you’re spending on aside from the obvious expenses like rent, mortgage, gas, and bills. In some cases, it’s the unnecessary purchases that eats up your savings and messes up your budget, so you need to figure out what these are to avoid falling in those money traps again.

  1. Build an emergency fund.

An emergency fund is a separate source of money that’s designated for the rainy days or as its name suggests, emergencies. Having an emergency fund helps keep other areas of your finances intact or unaffected when you meet unexpected or unforeseen expenses.

  1. Find or seize opportunities to earn extra.

If you’re strapped for cash or need more money for a particular expense or financial goal, you can find ways to earn extra income. One of the ways to do so is through selling some of your old items.

You can hold a garage sale or post your items on different online platforms. Meanwhile, if you have valuable items such antiques, jewelry, or artwork, you can take them to Biltmore Loan.

Biltmore Loan and Jewelry buys or lends on high-value assets, some of which are usually turned down by pawnshops. Biltmore Loan is known for helping clients through giving offers and appraisals that are higher than industry standards. If you want to know more about the items we buy or the loans we grant, please get in touch with us via phone or simply fill out the form found on this site to get an appraisal from us.

  1. Set financial goals.

What do you want your money to do for you? Do you want to use it for a new house, save a particular amount on a particular date, or be debt-free? Part of money management is laying down your financial goals. This way, you can explore options on how to attain them. More so, it helps you become aware of what you need to focus on, especially when you’re budgeting.

  1. Know the difference between wants and needs.

Managing your money is all about learning to prioritize your spending. That’s why you need to know the difference between your wants and needs. While it’s easy to define, drawing the line can be difficult for some people. So how do you know which purchases you should prioritize and expenses you can put on hold?

If you’re buying an item, say a refrigerator, because your current one is already broken, that’s a need. By all means, spend money on it. Meanwhile if you want to purchase a new designer handbag because your favorite celebrity endorsed it as a must-have this season, that’s most likely a want and if you have other pressing expenses and needs, you may want to postpone splurging on that purse for later.

  1. Save for the future.

Start saving for retirement as early as you can. There are different ways to set aside money for your golden years such as 401k or IRA as well as financial products that can help boost your nestegg for retirement.

Remember, your retirement is the time when you will get to enjoy the fruits of all your years of hardwork. Don’t let financial woes steal that from you.

  1. Stay consistent.

Fulfilling your financial goals is not an overnight thing. It takes time. That’s why you need to be patient and consistent with your money habits.

While National Financial Literacy Month will only run for 30 days, we hope that its impact will last all year round. The ten tips above will help you get your finances in order and achieve both your short and long-term goals.

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