by admin
15. July 2010 03:51
Hi everyone. J.G. Wentworth here.
Let me share with you a subject that is near and dear to my heart. This subject is financial literacy. I think to function in this world effectively, we’ve all got to have a handle on some basic financial concepts and skills. The term financial literacy is a big one and covers a lot of ground, but here are some of the primary building blocks.
- Home economics. This refers to the basic financial tasks of running a home and includes items such as establishing a bank account, depositing checks, paying bills and getting access to credit.
- Savings. We all know what saving is. What’s far less appreciated however is an understanding of why saving is so important. The fact is there’s always a rainy day out there somewhere, and saving is what enables us to weather the storm and not get washed away by it. Saving also gives you the power to make choices about what you want to do and not have choices made for you.
- Investment. Let’s face it, this is the toughest part of financial literacy. Heck, it seems like the pros don’t even understand what they are doing sometimes. But that should not prevent you from making investments as your finances allow. There’s an entire industry devoted to helping people of all means invest, so there’s no excuse not to do what you can to make your money grow.
- Debt management. Getting into debt is easy. Getting out can be much more difficult. Because of this it’s important to understand how debt work for you, and how it can work against you.
- Budgeting. Most of us have limited incomes and all of us have expenses. Finding out how to allocate limited income to what can be limitless expenses is an important skill. The inability to budget is one of the primary causes of chronic debt.
So, as you can see, that the topic of financial literacy is quite broad. But that’s not excuse for being financially illiterate. If anything it’s a good reason to commit yourself to learning all you can about these skills and the impact that the lack of them can have on your life.
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