5 pillars of Financial Literacy
The five key principles of financial literacy will help you lay the foundations for a strong financial future.
1.Earn: Understand your pay and benefits to make the most of what you earn. Take advantage of your workplace benefits and your company’s match policy for your 401(k) account. Check out the interactive guide on planning for retirement.
2. Save and invest: Save for future goals, like buying a house or retiring. Creating a budget can help you start working towards your aspirations, even if you need to start small.
3. Protect: Take steps to safeguard yourself in case of unexpected emergencies, which can be very costly. This includes accumulating an emergency savings fund and making sure you have the insurance you need.
4. Spend: Be sure you are getting good value for your purchases by shopping around and comparing your options. When considering large purchases, determine whether it is a need or a want and make sure you are living within your means. Other tips for developing healthy financial habits can be found in the interactive guide.
5. Borrow: Borrowing money enables essential purchases, like going to college or buying a home. When considering taking on debt, make sure you are prepared to manage it. Not all debt is bad; it can also help you grow your wealth by providing liquidity needs while your investments grow.