Whether you are a student trying to figure out how adulting and finances work, a startup entrepreneur, or a parent ironing your budget, elevating your financial literacy matters and can control many aspects of your life, including financial decisions, debt management, and how you manage money.
According to a report from the World Bank, there is a crisis in Philippine education, with more than 80 percent of Filipino children performing poorly due to limited proficiency in the languages in their schools, on top of terrible school climate and high levels of bullying. This crisis worsened with the lockdowns from the past years, which raises alarms for the country.
Elevating Financial Knowledge Among Students
Various finance committees and institutions have been taking initiatives to elevate financial education for students by organizing events. Some of these events include campus tours and other projects that allow schools to participate in promoting financial education and literacy.
However, improving financial literacy continues beyond education. We still have a long way to go as a country.
Why is Financial Education Important?
Building Financial Literacy
Being more financially literate can help with your confidence when dealing with, well, money. It can also help you brace against challenges by understanding how to prevent and manage financial difficulties.
Understanding your income and expenses and ensuring debt is repaid and avoided is what makes financial literacy important among many other things.
Elevating your financial education sets you up during financial emergencies and improves your ability to make better decisions. It can also ease the distress of living paycheck to paycheck.
Here are some ways to finally take control and improve your financial literacy.
Make or Update Your Budget
Whether fresh from school or approaching retirement, making or updating your budget is essential when managing your finances. You can better track your monthly expenditures by creating a budget worksheet. It can be easy to overlook saving money if you do not know how much money is coming in and going out.
Many budgeting tools and apps are available online to help you organize your finances and make life easier. Personal finance apps might assist you in streamlining your monthly spending and saving routines. When you enter all of your financial commitments into a money management app, you will be able to understand your spending patterns and decisions more clearly.
You can monitor your money, budget, and income with the right finance tools. You can also organize your expenses and pay your bills on schedule with the right budgeting app.
Set aside an Emergency Fund
As accidents, emergencies like job loss, opportunities, health care costs, and practically any life event can happen without warning, it is imperative that you set aside a certain amount as an emergency fund, like savings accounts, which you can use during crisis and should not reallocate wantonly. At least you have something to bank on when you are faced with a financial situation.
Retirement Savings
You do not have to start building your retirement savings late in life. Even as young adults, you can begin setting aside for your retirement fund to ensure financial well-being and financial stability in your twilight years.
Know and Optimize Your Banking Experience
When you do not optimize your banking, you are not making the most of your money. You can begin streamlining your experience by finding the right bank. Then, check what account options and investment options you have. AllBank offers seamless convenience, security, and boundless opportunities to help you embark on your financial literacy journey.
You can schedule an appointment with a financial advisor to learn more about your banking, saving, and investing options. Depending on your circumstances and goals, they can help you decide ideal options.
Understand Credit Scores
Simply put, your credit score describes your commitment to your credit. It is usually a three-digit number that shows borrowing and repayment history like a credit history. The higher your score, the more credible you are in the eyes of creditors.
Higher credit scores result from good credit management, which decreases your borrowing costs. Smart and sound financial decisions such as living within your means and financial capability, managing your debt responsibly, and making on-time minimum payments on all expenses, including credit card balances, can raise your credit score.
They can also lower the interest rates on your loans and increase the money you have available for saving and investing.
Join an Accountability Community
Despite your best efforts, life occasionally gets in the way of wise savings and investing choices. Unfortunately, making excuses will likely result in your financial goals being postponed until tomorrow. You can locate a group of like-minded individuals to help you stay accountable in these circumstances.
You can create an interest group with your friends if your financial goals are similar to share knowledge and discuss how you are individually developing better money management techniques. You can also start your own financial social media community or join an existing one.
Pay Your Bills on Time
Make sure your monthly bills are always paid on time. You could make the most of some features in billing pay apps that allow you to make automatic withdrawals and scheduled payments for bills. In addition, you can also set up reminders and alarms for payments.
Teach Your Family Healthy Financial Literacy Advice
If you have a child, help them start a savings bank account and teach them to manage money and save money. Learning money management at a young age can help tremendously build a person’s foundation in improving their financial literacy, which will carry on throughout their adult life. If your other family members are also willing to learn, you can teach them some techniques that could help them save up a little more.
Look into Financial and Credit Counseling
Before you borrow money from financial institutions, try consulting with credit counseling agencies that employ advisers qualified in budgeting and debt repayment and are another source of professional help. If you have the money, you might also want to think about working with a licensed financial planner.
Their offerings include debt reduction, college savings, tax, and financial planning. Some reputable charitable organizations and institutions provide financial counseling.
Study Now, Thank Yourself Later
Various resources are available to help you elevate your financial education, such as online journals, websites, and forums, like those from the National Financial Educators Council, which can offer insights and inform you of economic trends and events to help you manage your finances.
You can also read personal finance books, subscribe to finance newsletters, listen to finance podcasts, follow financial experts on social media, and even enroll in a course on financial education.
These tips can help you and your loved ones develop financial literacy skills.
Begin your financial literacy journey and start an AllBank savings account today!
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