Financial Literacy Resources (2024)

FAQs

How do I teach myself financial literacy? ›

Financial literacy refers to the understanding that includes how to earn, manage, and invest money and has a critical impact on students' ability to make smart choices.

Students classify those characteristics based on the three C's of credit (capacity, character, and collateral), assess the riskiness of lending to that individual based on these characteristics, and then decide whether or not to approve or deny the loan request.

Financial literacy is the knowledge and ability to manage your money in a way that helps you grow stability and feel confident and resilient. Key aspects of financial literacy are budgeting, saving and managing debt.

When following the 10-10-80 rule, you take your income and divide it into three parts: 10% goes into your savings, and the other 10% is given away, either as charitable donations or to help others. The remaining 80% is yours to live on, and you can spend it on bills, groceries, Netflix subscriptions, etc.

Financial literacy is having a basic grasp of money matters and its four fundamental pillars: debt, budgeting, saving, and investing. It's understanding how to build wealth throughout one's life by leveraging the power of these pillars.

This article will explore the five basic principles of financial literacy: earn, save & invest, protect, spend, and borrow, providing you with actionable insights to enhance your financial knowledge and make the most of your resources.

The Khan Academy Financial Literacy course is self-paced and completely free. The course is made up of multiple units, each with its own lessons, covering topics like budgeting, saving, credit, investments, insurance, taxes, scams, fraud and more.

What are the 4 steps to financial literacy? ›

Key steps to attaining financial literacy include learning how to create a budget, track spending, pay off debt, and plan for retirement.

There are some differences around how the various data elements on a credit report factor into the score calculations. Although credit scoring models vary, generally, credit scores from 660 to 724 are considered good; 725 to 759 are considered very good; and 760 and up are considered excellent.

By combining the golden rule of “Pay Yourself First” with the 50/30/20 rule, you create a comprehensive approach to managing your finances. The golden rule ensures that savings and investments are prioritized, while the 50/30/20 rule provides a framework for allocating your income across different expense categories.

1. Budget your money. In general, there are four main uses for money: spending, saving, investing and giving away. Finding the right balance among these four categories is essential, and a budget can be a very useful tool to help you accomplish this.

The foundation for financial literacy should be laid early in a child's life. As soon as they start understanding basic math, you can begin discussing simple money concepts. Use everyday activities like grocery shopping or counting their pocket money to introduce them to the value of money and basic calculations.

The 5 components of financial literacy. There's plenty to learn about personal financial topics, but breaking them down can help simplify things. To start expanding your financial literacy, consider these five areas: budgeting, building and improving credit, saving, borrowing and repaying debt, and investing.

For better or worse, most financial education takes place at home. But by and large, Americans aren't great at discussing money matters, so many people end up learning via the school of hard knocks.

The Bottom Line

Listening to podcasts and reading books about specific areas of finance that interest you help break down more complex financial topics and speed up the learning process. There are also many paid and free courses out there that offer courses in different areas of finance and investing.