EHAS WORDS TO YOU
To succeed, you will soon learn, as I did, the importance of a solid foundation in the basics of education—literacy, both verbal and numerical, and communication skills. - Alan Greenspan
Any financial literacy improvement will profoundly impact the youths and their ability to provide for their future. Recent trends are making it all the more imperative that consumers understand essential finances because they are now asked to shoulder more of the burden of investment decisions in their future accounts, all while having to decipher more complex financial products and options. Becoming financially literate is not easy, but mastering it can ease life’s burdens tremendously.
INTRODUCTION TO THE LESSONS AND WORKSHEETS
Financial literacy helps a person achieve a financially balanced, responsible, and ethical lifestyle and make appropriate financial choices. Studies have shown that financial literacy dramatically affects a person’s saving, investment, debt management, and loan-taking practices. Furthermore, this knowledge helps someone to take appropriate action regarding their financial affairs. Therefore, being financially literate can change one’s ability to earn a livelihood, contribution to society, and one’s attitude toward money.
Learn How to Budget
The first step to gaining financial literacy is learning how to budget. When you have a budget plan, you can spend money accordingly and will be able to save any extra to use later in case of an emergency. Without a budget plan, you will be unable to control your spending and, as a result of this overspending, may suffer if your salary or allowance ends. To make a budget plan, you need to note your monthly income and track your spending. You need to include all your fixed expenses like your mortgage or rent, utility bills, loan payments, etc., and then include variable expenses such as groceries, entertainment, etc. After tracking your significant spending, set your financial goals, saving money, for example. There are two types of financial goals: short-term goals and long-term goals. After setting all these up, finalize your plan and follow it to achieve financial balance.
Understand Your Credit Score
It is imperative to understand your credit score. But why is your credit score important, how is it calculated, and how can you do it? When someone pays off their credit bills on time, they are viewed as trustworthy by the lender. As a result, they build a credit history and are afforded an improved credit score to help them obtain future loans. In the US, a credit score is a three-digit number from 300 to 850. A high score indicates someone who is low risk financially and repays their credit bills on time, while a low score indicates a credit risk who has likely not previously paid their credit bills on time. You should also be aware of your credit report, which summarizes your financial situation. By reviewing your credit report, you can spot any errors or fraudulent entries and take legal steps to overcome the loss. This report may also help you track your spending and improve your credit score.
Understanding the importance of paying off your debt/loans is essential. Having a debt-free life is a desirable dream for most individuals. There are two ways to pay off your debt fast. One way is to identify the loan with the highest interest rate and pay this off first, hence reducing the amount of interest you will need to pay in the long term. Once this debt is cleared, you can then focus on paying off the loan with the second-highest interest rate, and so on. An alternative approach is to pay off all small debts first and then focus on the larger loans.
Open a Savings Account
A savings account will help you save any extra money, is the best way to keep your money safe and secure, and may even pay you interest and offer insurance and security. A savings account also makes billing more straightforward and convenient for the user, while an ATM card is portable and better than keeping cash in a wallet.
You have two choices if you wish to put more money aside as savings. You can take on another job to increase your income or reduce your expenses. Spending can be reduced by planning your grocery shopping list carefully. For example, if you want to buy two items and reduce your spending simultaneously, you need to identify the most critical item and buy that one first. Then, when your new salary comes in the next month, you can buy the second item. Dividing your spending over several months in this way can help you to save money. And reducing your spending will help you to reach your financial goals.
Welcome to the Understanding Budgets and Financial Reports workshop. Every day businesses deal with budgets and financial reports in some form or fashion. At a minimum, managers review budget numbers and run financial reports for decision-making and reporting to shareholders and Federal regulators once a month. Moreover, many companies have devoted the last few months to creating budgets for the following calendar year. In addition, organizations create and disseminate year-end financial reports to investors. This workshop aims to give the participant a basic understanding of budgets and financial reports so they can hold relevant discussions and render decisions based on financial data. This course will define key terms like ROI, EBIT, GAAP, and extrapolation. Furthermore, this one-day course will discuss commonly used financial terms, financial statements, budgets, forecasting, purchasing decisions, and laws that regulate the handling of financial information. Before we begin, let us get to know more about each other.