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April is National Financial Literacy Month

April is designated as Financial Literacy Month and is a great time to focus on the importance of understanding personal finance. Financial literacy refers to the knowledge and skills needed to make informed decisions about managing money effectively. It is an essential life skill that helps individuals and families achieve financial stability and security.

In today’s society, financial literacy is more important than ever. According to the Financial Industry Regulatory Authority (FINRA), nearly two-thirds of Americans are unable to pass a basic financial literacy test. This lack of knowledge can lead to a wide range of financial problems, from living paycheck to paycheck to being unable to save for retirement.

Financial literacy is particularly critical for young people who are just starting out in the workforce. Many young adults are burdened with student loan debt, and they may lack the knowledge needed to manage their finances effectively. By educating young people about financial literacy, we can help them avoid debt, build credit, and prepare for a secure financial future.

The benefits of financial literacy are numerous. Here are a few reasons why it is important to promote financial literacy:

  1. Making informed decisions. By understanding personal finance, individuals can make better decisions about saving, investing, and spending money. This can help them achieve their financial goals and avoid financial pitfalls.
  2. Avoiding debt. Many people struggle with debt, and a lack of financial literacy can make it difficult to manage debt effectively. By educating people about personal finance, we can help them avoid debt and manage it effectively if it does occur.
  3. Preparing for retirement. Retirement planning is an important part of personal finance. By understanding retirement savings options, investment strategies, and tax implications, individuals can prepare for a secure financial future.
  4. Building wealth. By understanding personal finance, individuals can build wealth over time through saving, investing, and smart financial decisions. This can help them achieve financial freedom and security.

During Financial Literacy Month, there are a variety of resources available to help people improve their financial literacy. Credit unions, community organizations, and government agencies often provide free resources and education on personal finance topics.

In addition to these resources, individuals can also take steps on their own to improve their financial literacy. Here are a few tips:

  1. Read personal finance books and blogs. There are many books and blogs available that provide valuable information on personal finance topics. By reading these resources, individuals can learn about personal finance at their own pace. Get confident in your knowledge by reading more of our blogs HERE.
  2. Take a personal finance course. Many community organizations and colleges offer personal finance courses. These courses can provide a structured learning environment and allow individuals to ask questions and interact with others. At LorMet Community Credit Union, we have increased our efforts to offer financial literacy training at local school districts. See our financial literacy presentations HERE.
  3. Use financial tools and apps. There are many financial tools and apps available that can help individuals manage their finances. These tools can help with budgeting, saving, investing, and more. Explore how the LorMet Mobile App can help you HERE.
  4. Meet with a financial advisor. A financial advisor can provide personalized advice and guidance on personal finance topics. They can help individuals create a financial plan and make informed decisions about their finances.

Financial Literacy Month serves as a reminder of the importance of financial literacy and the impact it has on our lives. By educating individuals about personal finance, we can help them make informed decisions, avoid debt, prepare for retirement, and build wealth. It is a critical life skill that benefits everyone, from young adults just starting their careers to small business owners looking to grow their businesses. By taking advantage of the resources available and making an effort to improve our financial literacy, we can achieve financial stability and security, both in the short term and long term.

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Last Updated: April 17, 2023