Financial literacy gives an individual the tools and resources they need to be financially secure for life.<\/p>
The lack of financial literacy can lead to many pitfalls, such as overspending, an unsustainable debt burden, and a failure to save for retirement. These, in turn, can lead to poor credit, bankruptcy, housing foreclosure, and other negative consequences.<\/p>" } } , { "@type": "Question", "name": "How Do I Become Financially Literate?", "acceptedAnswer": { "@type": "Answer", "text": "
All the education you need is at your fingertips, and it's free. Try the adult financial education resources available online from the Consumer Financial Protection Bureau. Young people might like the “Resources for Youth<\/a>” at MyMoney.gov.<\/span><\/span><\/p> You can also take it step by step. Step 1 could be learning how to create a budget<\/a> and stick to it.<\/p>"
}
}
,
{
"@type": "Question",
"name": "What Are Some Popular Personal Budget Rules?",
"acceptedAnswer": {
"@type": "Answer",
"text": " Two commonly used personal budgeting methods are the 50/20/30<\/a> and 70/20/10 rules, and their simplicity is what makes them popular.<\/p> The first entails dividing your after-tax pay into three areas: needs (50%), savings (20%), and wants (30%).<\/p> The 70/20/10 rule follows a similar blueprint, recommending that your after-tax, take-home income be divided into segments devoted to expenses (70%), savings or reducing debt (20%), and investments and charitable donations (10%).<\/p>"
}
}
,
{
"@type": "Question",
"name": "What Are the Principles of Financial Literacy?",
"acceptedAnswer": {
"@type": "Answer",
"text": " There are five broad principles of financial literacy. Although other models may list different key components, the overarching goal of financial literacy is to teach individuals about earning, spending, saving, borrowing, and protecting their money.<\/span><\/p>"
}
}
]
} ] }
]