Financial Literacy - A National Priority - From Gratitude to Greatness: Brownlee Global's Path to a Purposeful LifeFrom Gratitude to Greatness: Brownlee Global's Path to a Purposeful Life

Knowledge is your best financial asset

Financial literacy and money management skills require greater attention and urgency in the United States. According to a 2019 study by the FINRA Investor Education Foundation, there’s been a decrease in recent years of how much Americans know about interest rates, taxes, loans, and debt…the major money decisions that affect so much of our lives.

The study also showed that millennials have the biggest gap in money knowledge and skills as compared to other age groups. This is worrisome because they’re America’s largest generation, and millennialsare often shouldering outsized debts and limited economic mobility.

Moreover, George Washington University research showed that 1 in 5 American high school students lacked even basic financial skills — such as the ability to interpret a pay stub to determine how much money will be deposited into their bank account or the savvy to avoid being tricked into sharing an online bank account logon.

The average student debt in 2017 was about $29,000, according to the Institute for College Access and Success. About 1 million borrowers default for the first time on their federal student loans each year, a report from the Urban Institute found.

Learning about how to budget, how to wisely invest, and how to control your spendings can seem daunting, but money experts like Stefanie O’Connell, author of The Broke and Beautiful Life, have made it their mission to make finances empowering for everyone.

Think of it this way: The more you know about your own spending habits, the less likely you are to make a costly mistake.

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Financial literacy is the possession of skills that allows Americans to make smart decisions with their money, according to financial coach and guru Dave Ramsey. Financial literacy means people can regularly do the right things with money that lead to the right financial outcomes.

Financial literacy helps people develop a stronger understanding of basic financial concepts—that way, they can handle their money better, especially when you consider how the typical American handles money:

Nearly four out of every five U.S. workers live paycheck to paycheck.
Over a quarter never save any money from month to month.
Almost 75% are in some form of debt, and most assume they always will be.(1)

When you have financial literacy knowledge and skills, you’re able to understand the major financial issues most people face: emergencies, debts, investments and retirement. Financially literate people know their way around a budget, know how to use stocks and bonds for financial security, and know the difference between a 401(k) and a 529 plan.

References:

From Gratitude to Greatness: Brownlee Global's Path to a Purposeful Life

Guide and Educate Individuals How to Build Long-Term Wealth, Better Manage Their Money, and Achieve Financial Freedom

Financial Literacy – A National Priority

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