Being able to make informed financial decisions means being financially literate, a skill set that we will be covering on our educational website. The basis of making informed financial decisions lies in understanding financial literacy, which is being able to use financial skills such as borrowing, saving, budgeting, and investing and understanding how they work in order to avoid financial problems and build wealth. Being financially literate has many benefits, and a strong foundation may allow you to achieve various life goals, whether it be to save for education or retirement, start a business, or simply accumulate wealth.
Why is Financial Literacy so Important?
In our world where consumer habits and financial products are continuously changing, it is becoming increasingly difficult for people to manage their finances. With credit cards and online shopping gaining popularity, it has become easier for us not only to shop, but accumulate debt. With many people left unemployed and financially vulnerable during the pandemic, it has become more important than ever to be able to make informed financial decisions, and although being able to manage your money may seem like an intuitive skill, only 57% of young adults age 35 or below in the United States are financially literate according to the Milken Institute. Thus, we would like to take the time to help people make better financial decisions and have a basic grasp of the four fundamental pillars of financial literacy which will be explored in the next page.