Basic money management skills are crucial for Millennials’ long-term financial stability and success. Strong financial literacy means understanding a number of different concepts such as budgeting, checking and savings accounts, credit, investments and ways to spend your money. So, the more financial literacy Millennials have, the easier it will be to avoid consumer debt and prepare for the future. Here are some tips for Millennials to become financially literate.
Tuesday Tip – Gaining Financial Literacy
- Learn how to budget. Budgeting is the cornerstone of responsible financial planning. Creating and maintaining a budget shows exactly how much money you have and where it’s being spent. A budget will help you find ways to save money and plan for the future. Use this budgeting worksheet to get started.
- Understand credit. Learn the concepts of credit, such as: why credit is important, the information used to calculate a credit score and how to improve credit scores. It’s also crucial to understand the best strategies for paying down credit card debt.
- Create a checking/savings account. Opening a checking and/or savings account is one of the first actions you can take to keep your money safe and make paying bills easier and more convenient.
- Understanding debt/loans. Different debt requires different strategies. Types of debt may include; student loan debt, auto loans, mortgage, credit card debt, medical bills, and even utilities. Research each to get better insight before committing to any debt.
- Understand the danger of identity theft. Identity theft occurs when someone uses your personal information, such as your name, Social Security number, credit card number or other identifying information, without your permission to commit fraud or other crimes. So, the best way to help prevent becoming a victim of ID theft is to safeguard your personal information.