Financial literacy is not about learning how to make money alone. It is about helping an individual master how to make informed financial decisions that will preserve but your wealth and sanity.

This means learning how to pay your bills, how to convince people to give you money,how to handle and save money responsibly, how and why to invest and plan for retirement and the likes.

Being Financially savvy is a personal skill that benefits you throughout life, but unfortunately, not many people take this seriously.

Basic Financial Literacy should be compulsory for every individual and household in America, the Uk, Canada, and other developed countries where everyone seems to be so busy that many little but important things of life are forgotten.

Here are some interesting findings that reveal why financial education should matter in America…

• Two-thirds of American adults can’t pass a basic financial literacy test. (Fortune

• 44% of Americans don’t have enough cash to cover a $400 emergency. (Forbes)

• The majority of US adults (61%) have had credit card debt in the past 12 months and nearly two in five (38%) carry such debt from month-to-month. (NFCC)

• 56% of American adults have less than $10,000 saved for retirement when you combine the 33% who have nothing saved with the 23% who have a small amount saved. (Time)

• Nearly four out of every five U.S. workers live paycheck to paycheck. (CareerBuilder)

A  2018 FINRA study found that financial capability, stability, and confidence aren’t improving due to a lack of financial knowledge.

 The study found that over 53% of adults say thinking about their financial situation makes them anxious. And 44% say discussing their finances is stressful.

Younger Americans are feeling the greatest burden.

The widening gaps between those who are struggling and those who are prospering financially as those between the ages of 18 to 34 have the highest levels of financial stress (63%) and anxiety (55%).

This makes it important for you to take the initiative to self-educate and grow your financial knowledge, by learning the things that keep you ahead.

The reason why you need to take your financial literacy as a personal responsibility is that despite how important financial literacy skill is, the schools doesn’t teach it. So, if you must know it, you have to teach yourself.

Why Is Financial Literacy Important?

There are many reasons why we need to study and have financial literacy as a strong part of our lives.

And we have tons of financial literacy books,courses and pdfs to help any serious minded person to start the journey.

• Financial literacy is important because it provides a foundation for informed financial decision-making. When you have it, you can more easily make financial decisions that empower and promote your progress.

• Financial literacy also helps you to be more financially responsible. Things like debt, retirement, and the likes that used to be taken care of by the employer and the government are now being left for the individual to sort out by themselves.

• You can easily save money on important life decisions. Take loans or credit cards for instance. Being financially literate will help you save a lot of money over time, and so can paying off credit card balances each month so you don’t carry a balance and accrue more interest charges. 

And if you are already in debt, financial literacy can help you choose the best methods to get out of debt, either on your own or with the help of a financial counseling programs. 

• Financial literacy can help protect you from bankruptcy. A financially literate individual knows how much to save and set some money aside to take care of emergency expenses.

• Financially literate people are also less vulnerable to fraud since they have a good understanding of their finances and take the time to make informed financial decisions.

• Financial literacy is also something you can share with your family so that everyone is better prepared for the future. Whether you want to pay off debt, save for retirement, or start a business, financial literacy skills can help you navigate almost any situation.

• The biggest benefit is that financially literate people are better prepared for the future. It goes beyond a few money management tips to proper financial know how skills that will save your life.

 Money alone never helped anyone to remain rich, financial literacy does.

This is why everyone should be focused on becoming a little more financially literate every day so that one can create and maximize opportunities that life offers.

To master your financial process and improve your financial literacy, consistently and intentionally focus on gaining understanding in the following areas:

Important Areas To Focus Your Financial Education

Some of the financial literacy examples we have below we help you to know what to focus on per time.

It is very easy to get lost with all the financial education resources out there, but when you know what to focus on, it helps you build focus.

#1. Understand The Use Of Corporation.

The rich don’t have anything to their names neither do they make money to give it all away to the government by way of taxes.

 To make and protect your wealth, master the intricacies of various types of corporation.

In  the United States, there are 4 types of corporation you must master how they work.

C corporations refers to any corporation that, under United States federal income tax law, is taxed separately from its owners.

S corporations refers to a corporation under the law of the state in which the entity is organized in ownership, tax payment and other important purposes.

Limited Liability Companies (LLCs) this It is a legal form of company that provides limited liability to its owners in the vast majority of United States jurisdictions. 

Nonprofit Organizations this is an organization that uses surplus revenues to achieve its goals rather than distributing them as profit or dividends

You must pay attention and understand how these various corporations work and how to make them work for you per time based on the final outcome that you want to achieve.

#2. Master Business Laws. Ignorance of the law has great cost to wealth accumulation.

 It can be pretty amazing how easily you can be bullied around without a good mastery of the various laws guiding your financial transactions.

There are a variety of disciplines such as  tax law, intellectual property law, bankruptcy law, employment law, real estate law and the likes are all important areas you must read up on and pay attention to.

You don’t need to become an attorney to do this. Just make friends with some intelligent and smart people in the field while also educating yourself using google and any means possible.

That will also mean that you won’t get into any transaction without first checking things with your Attorney as well.

#3: Understand  Financial Words And Numbers. Understanding how to read a company’s financial statements is a key financial skill for anyone that would want to make smart investment decision.

This doesn’t require you to become a mathematician.

All you need to know is how to read common figures in the budget, financial statements, business charts, and graphs and understand how they impact your financial choices.

Undersating money words and numbers can help you to understand conversations in a deeper way that others can’t.

In the world of money, there is no better skill than the ability to understand the meaning of things.

#4: Understand  The Market And How It Works. A market is any situation that brings buyers and sellers together.

Every market is driven by the forces of demand and supply and the psychology of fear and greed.

To win in any transaction, you must understand how these two drive and influence choices and decision making.

#5: Understand Investment Strategies And How They Work. This is the science of money multiplication. Strengthening your financial IQ in this area will help you see money with your mind and not your eyes thereby aiding your ability to create money out of thin air.

#6: Understand Money Sense. Money Sense is your ability to understand what money is, how it works and how to make it work for you in any economy.

When you understand currency and other forms through which money exists, why it exists in each of those forms per time, how each of those forms work and how to make use of that information to attract economic power to yourself, you will be ahead of many Americans.

7 Be Financially Mindful. Being mindful with your finances will help you to focus on making changes you’re in control of and allows you to react positively to situations that are out of

Final Thoughts

Taking the responsibility of improving your financial literacy is a decision that you will never regret and which your future will also be grateful for.

Though it might seem there is a lot to understand, being financially smart is a skill that will live with you forever which you can equally go ahead to pass to your kids and others around you.

And this is apart from the fact that it will help you to make smart financial decisions and easily navigate the intricate world of money with ease.

With all the many advantages that come with financial education, it is a skill everyone should have.