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How can I develop financial literacy as a graduating high school senior?
I am a high school senior who is looking to be more educated on financial literacy for my postsecondary path.
Thank you!
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10 answers
Updated
Sasha’s Answer
Hi Madison,
The Five C's Relate to Financial Literacy. 5 C’s, which are cash flow, credit, collateral, capacity and character, are important when evaluating a business.
Below are some Financial Education Resources for H.S.
- Financial Literacy for Students - https://everfi.com/k-12/financial-education/
- FDIC Money Smart - https://www.fdic.gov/consumer-resource-center/money-smart-young-adults
- Debt Slapped: Student Loans - https://debtslapped.org/
- Financial Beginnings - https://www.financialbeginnings.org/
- Financial Lessons and Games: Visa’s Practical Money Skills - https://www.practicalmoneyskills.com/en
- Ted Talks Finance - https://www.ted.com/topics/finance
- NextGen Personal Finance - https://www.ngpf.org/
I hope you find these resources helpful. Best of luck!
The Five C's Relate to Financial Literacy. 5 C’s, which are cash flow, credit, collateral, capacity and character, are important when evaluating a business.
Below are some Financial Education Resources for H.S.
- Financial Literacy for Students - https://everfi.com/k-12/financial-education/
- FDIC Money Smart - https://www.fdic.gov/consumer-resource-center/money-smart-young-adults
- Debt Slapped: Student Loans - https://debtslapped.org/
- Financial Beginnings - https://www.financialbeginnings.org/
- Financial Lessons and Games: Visa’s Practical Money Skills - https://www.practicalmoneyskills.com/en
- Ted Talks Finance - https://www.ted.com/topics/finance
- NextGen Personal Finance - https://www.ngpf.org/
I hope you find these resources helpful. Best of luck!
Register for a basic business course as one of your electives going into college or look at your local community college public course offerings. These are great resources to delve deeper into personal finance.
Melicca Carpenter
Updated
Christine’s Answer
Hi Madison,
Great question and kudos to you for thinking about it. I'm curious as to what led you to do so. Anyway, here are some truths to help you better understand not just financial literacy but how to navigate the financial stresses life will bring.
1) Live below your means.
2) Save in different ways.
3) Take responsibility in educating yourself and minimize risk.
1) No matter how great your job is and how well it pays, there will be rainy days (sometimes monsoons) and financial stress will keep you up at night. 99% of the time, nobody will be there to save you and you will have to put your chin up, push your shoulders back, and simply get through it. Easier to do so when you haven't overcommitted to financial obligations.
2) Take your extra funds and stash cash, invest some in stocks with good dividends, have some 401k, buy a little dirt. All of these things will help you with having a balance of liquidity, growth and assets as you go along in case you need them. Slowly build your net worth early on.
3) Even though you may not be financing anything on your own yet (house, car, college), start learning what the process and paperwork looks like now so you are not naive or ignorant to the situation later on when you are ready to actually do the deals. You can simply Google what those general documents look like. Think of what you'll want to have in your little nest egg as a fallback if that monsoon comes and you don't have sure fire streams of income.
As an example, don't just look at what your mortgage payment will be, but factor in taxes, insurance, utilities, maintenance, etc. Grasp and understand the big picture. You want to avoid risks and make educated choices for yourself. You'll find that you can rarely rely on others.
Only bet on yourself and your abilities. Speaking of betting, don't gamble, the house almost always wins and the "almost" isn't worth it. I have seen friends and family's possessions and relationships lost because of it.
Hope that helps you with some perspective in a different light. Wishing you the best!
- Christine
Great question and kudos to you for thinking about it. I'm curious as to what led you to do so. Anyway, here are some truths to help you better understand not just financial literacy but how to navigate the financial stresses life will bring.
1) Live below your means.
2) Save in different ways.
3) Take responsibility in educating yourself and minimize risk.
1) No matter how great your job is and how well it pays, there will be rainy days (sometimes monsoons) and financial stress will keep you up at night. 99% of the time, nobody will be there to save you and you will have to put your chin up, push your shoulders back, and simply get through it. Easier to do so when you haven't overcommitted to financial obligations.
2) Take your extra funds and stash cash, invest some in stocks with good dividends, have some 401k, buy a little dirt. All of these things will help you with having a balance of liquidity, growth and assets as you go along in case you need them. Slowly build your net worth early on.
3) Even though you may not be financing anything on your own yet (house, car, college), start learning what the process and paperwork looks like now so you are not naive or ignorant to the situation later on when you are ready to actually do the deals. You can simply Google what those general documents look like. Think of what you'll want to have in your little nest egg as a fallback if that monsoon comes and you don't have sure fire streams of income.
As an example, don't just look at what your mortgage payment will be, but factor in taxes, insurance, utilities, maintenance, etc. Grasp and understand the big picture. You want to avoid risks and make educated choices for yourself. You'll find that you can rarely rely on others.
Only bet on yourself and your abilities. Speaking of betting, don't gamble, the house almost always wins and the "almost" isn't worth it. I have seen friends and family's possessions and relationships lost because of it.
Hope that helps you with some perspective in a different light. Wishing you the best!
- Christine
Updated
Chris’s Answer
To develop financial literacy, I would start by seeking out online courses or classes in your area. These are often free and provide peers to discuss topics you are not strong in.
I would also visit your local library. There is a wealth of fantastic books on topics like personal finance and budgeting. If you find a book that particularly speaks to you, look to purchase it to reference it often as you learn.
Lastly, look to those in your life of an older generation and ask them about their knowledge and what they have learned from their experiences.
I would also visit your local library. There is a wealth of fantastic books on topics like personal finance and budgeting. If you find a book that particularly speaks to you, look to purchase it to reference it often as you learn.
Lastly, look to those in your life of an older generation and ask them about their knowledge and what they have learned from their experiences.
Updated
Dr’s Answer
Madison, 🎉 Financial literacy is like learning the secret handshake to adulthood—except you don't need to know how to dance. 😎
Here’s your fun guide to getting your financial smarts on:
Start with the basics: Think of budgeting as planning your ice cream sundae. You gotta know how much to spend on toppings (expenses) and how much to save for a rainy day (or your next shopping spree). 📊
Use cool apps: There are apps out there that help you track your spending, savings, and investments. Consider them your financial superheroes—just without the capes. 🦸♀️
Watch YouTube tutorials: Some of the best finance gurus are on YouTube! It’s like watching Netflix, but instead of drama, you’re learning how to conquer debt and make money moves. 💵💡
Read books (yes, really): Books like The Richest Man in Babylon and Rich Dad Poor Dad are like the Hogwarts of financial education. Open one, and it's like magic for your bank account. 📚✨
Understand credit like it's your best friend (or worst enemy): Knowing how credit works is like knowing the secret recipe to a good pizza. Don’t let it burn you out (interest rates, yikes!). 🍕💳
Play with virtual stock markets: Test out your investment skills without actually risking your lunch money. It’s like playing Monopoly, but with actual lessons for the future. 🎮💰
And most importantly, make it fun! Your future self will thank you when you’re not scrambling to figure out how to pay rent with three months of takeout receipts. 😅
Good luck, Madison! You're about to make that financial literacy game strong! 💪💵
Here’s your fun guide to getting your financial smarts on:
Start with the basics: Think of budgeting as planning your ice cream sundae. You gotta know how much to spend on toppings (expenses) and how much to save for a rainy day (or your next shopping spree). 📊
Use cool apps: There are apps out there that help you track your spending, savings, and investments. Consider them your financial superheroes—just without the capes. 🦸♀️
Watch YouTube tutorials: Some of the best finance gurus are on YouTube! It’s like watching Netflix, but instead of drama, you’re learning how to conquer debt and make money moves. 💵💡
Read books (yes, really): Books like The Richest Man in Babylon and Rich Dad Poor Dad are like the Hogwarts of financial education. Open one, and it's like magic for your bank account. 📚✨
Understand credit like it's your best friend (or worst enemy): Knowing how credit works is like knowing the secret recipe to a good pizza. Don’t let it burn you out (interest rates, yikes!). 🍕💳
Play with virtual stock markets: Test out your investment skills without actually risking your lunch money. It’s like playing Monopoly, but with actual lessons for the future. 🎮💰
And most importantly, make it fun! Your future self will thank you when you’re not scrambling to figure out how to pay rent with three months of takeout receipts. 😅
Good luck, Madison! You're about to make that financial literacy game strong! 💪💵
James Constantine Frangos
Consultant Dietitian-Nutritionist & Software Developer since 1972 🡆 Optimization Of Human Performance
7217
Answers
Updated
James Constantine’s Answer
Good Day Madison!
How to Develop Financial Literacy as a Graduating High School Senior
1. Understand the Basics of Personal Finance
To develop financial literacy, start by familiarizing yourself with fundamental concepts such as budgeting, saving, investing, credit, and debt management. Understanding these basics will provide a solid foundation for making informed financial decisions in the future.
Budgeting: Learn how to create a budget that tracks your income and expenses. This will help you understand where your money goes and how to allocate it effectively.
Saving: Explore different savings strategies, including setting aside emergency funds and saving for specific goals like college or a car.
Investing: Gain knowledge about various investment vehicles such as stocks, bonds, mutual funds, and retirement accounts. Understanding the risk-return relationship is crucial.
Credit: Learn about credit scores, how they are calculated, and why they matter. Understand the implications of borrowing money and managing debt responsibly.
2. Utilize Online Resources and Courses
There are numerous online platforms offering free or low-cost courses on financial literacy. Websites like Khan Academy, Coursera, and edX provide structured learning paths that cover essential topics in personal finance.
Khan Academy: Offers comprehensive lessons on personal finance topics tailored for high school students.
Coursera: Features courses from universities that cover financial literacy fundamentals.
edX: Provides access to courses from institutions like Harvard and MIT focusing on economics and finance.
These resources often include interactive elements such as quizzes and practical exercises to reinforce learning.
3. Read Books on Personal Finance
Consider reading books specifically aimed at young adults or beginners in personal finance. Some recommended titles include:
“The Total Money Makeover” by Dave Ramsey
“Rich Dad Poor Dad for Teens” by Robert Kiyosaki
“I Will Teach You to Be Rich” by Ramit Sethi
These books offer valuable insights into managing money effectively and building wealth over time.
4. Attend Workshops or Seminars
Look for local workshops or seminars focused on financial literacy offered by schools, community centers, or non-profit organizations. These events often feature experts who can provide practical advice and answer questions directly.
5. Practice Real-Life Financial Skills
Apply what you’ve learned by practicing real-life financial skills:
Open a bank account if you don’t have one already; this will help you manage your money more effectively.
Start budgeting your allowance or part-time job earnings to gain hands-on experience.
Consider starting an investment account with small amounts of money through platforms designed for beginners.
By engaging in these activities, you will gain confidence in managing your finances.
6. Seek Guidance from Trusted Adults
Talk to parents, teachers, or mentors who have experience with personal finance. They can provide guidance based on their own experiences and help clarify any questions you may have about financial concepts.
7. Stay Informed About Current Financial Trends
Keep up with current events related to economics and finance through reputable news sources such as The Wall Street Journal or Bloomberg. Understanding broader economic trends can enhance your overall financial literacy.
By following these steps systematically, you can build a strong foundation in financial literacy that will serve you well throughout your postsecondary education and beyond.
Top 3 Authoritative Sources Used in Answering this Question:
Khan Academy A widely respected educational platform offering free online courses covering various subjects including personal finance fundamentals tailored for learners of all ages.
Coursera An online learning platform providing access to courses from top universities around the world that cover essential topics in finance and economics suitable for high school seniors preparing for their future.
Dave Ramsey’s Financial Peace University A program designed to teach individuals about budgeting, saving, investing, and debt management through practical lessons aimed at fostering long-term financial health.
Probability the answer is correct: 95%
✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫
|_______________God Bless You, Richly!_________________|
|________________James Constantine,___________________|
|_____________The Little Old Aussie Battler.____________|
|_____Programming For Your Nutrition Education____|
|__________________ ~ Since 1972! _____________________|
✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫
How to Develop Financial Literacy as a Graduating High School Senior
1. Understand the Basics of Personal Finance
To develop financial literacy, start by familiarizing yourself with fundamental concepts such as budgeting, saving, investing, credit, and debt management. Understanding these basics will provide a solid foundation for making informed financial decisions in the future.
Budgeting: Learn how to create a budget that tracks your income and expenses. This will help you understand where your money goes and how to allocate it effectively.
Saving: Explore different savings strategies, including setting aside emergency funds and saving for specific goals like college or a car.
Investing: Gain knowledge about various investment vehicles such as stocks, bonds, mutual funds, and retirement accounts. Understanding the risk-return relationship is crucial.
Credit: Learn about credit scores, how they are calculated, and why they matter. Understand the implications of borrowing money and managing debt responsibly.
2. Utilize Online Resources and Courses
There are numerous online platforms offering free or low-cost courses on financial literacy. Websites like Khan Academy, Coursera, and edX provide structured learning paths that cover essential topics in personal finance.
Khan Academy: Offers comprehensive lessons on personal finance topics tailored for high school students.
Coursera: Features courses from universities that cover financial literacy fundamentals.
edX: Provides access to courses from institutions like Harvard and MIT focusing on economics and finance.
These resources often include interactive elements such as quizzes and practical exercises to reinforce learning.
3. Read Books on Personal Finance
Consider reading books specifically aimed at young adults or beginners in personal finance. Some recommended titles include:
“The Total Money Makeover” by Dave Ramsey
“Rich Dad Poor Dad for Teens” by Robert Kiyosaki
“I Will Teach You to Be Rich” by Ramit Sethi
These books offer valuable insights into managing money effectively and building wealth over time.
4. Attend Workshops or Seminars
Look for local workshops or seminars focused on financial literacy offered by schools, community centers, or non-profit organizations. These events often feature experts who can provide practical advice and answer questions directly.
5. Practice Real-Life Financial Skills
Apply what you’ve learned by practicing real-life financial skills:
Open a bank account if you don’t have one already; this will help you manage your money more effectively.
Start budgeting your allowance or part-time job earnings to gain hands-on experience.
Consider starting an investment account with small amounts of money through platforms designed for beginners.
By engaging in these activities, you will gain confidence in managing your finances.
6. Seek Guidance from Trusted Adults
Talk to parents, teachers, or mentors who have experience with personal finance. They can provide guidance based on their own experiences and help clarify any questions you may have about financial concepts.
7. Stay Informed About Current Financial Trends
Keep up with current events related to economics and finance through reputable news sources such as The Wall Street Journal or Bloomberg. Understanding broader economic trends can enhance your overall financial literacy.
By following these steps systematically, you can build a strong foundation in financial literacy that will serve you well throughout your postsecondary education and beyond.
Top 3 Authoritative Sources Used in Answering this Question:
Khan Academy A widely respected educational platform offering free online courses covering various subjects including personal finance fundamentals tailored for learners of all ages.
Coursera An online learning platform providing access to courses from top universities around the world that cover essential topics in finance and economics suitable for high school seniors preparing for their future.
Dave Ramsey’s Financial Peace University A program designed to teach individuals about budgeting, saving, investing, and debt management through practical lessons aimed at fostering long-term financial health.
Probability the answer is correct: 95%
✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫
|_______________God Bless You, Richly!_________________|
|________________James Constantine,___________________|
|_____________The Little Old Aussie Battler.____________|
|_____Programming For Your Nutrition Education____|
|__________________ ~ Since 1972! _____________________|
✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫ ✫
Updated
Malcolm’s Answer
Developing financial literacy as a graduating high school senior is a smart way to prepare for life beyond school. Here are practical steps you can take:
1. Learn the Basics of Budgeting
Understand income vs. expenses: Know how to track what you earn (if you have a part-time job or any savings) and how much you spend.
Create a budget: There are simple apps like Mint, YNAB (You Need A Budget), or even just a spreadsheet to help you manage money.
Set financial goals: Set short-term and long-term goals, like saving for college, buying a car, or having an emergency fund.
2. Understand Credit and Debt
Learn about credit scores: Understand how credit works, how to check your credit score, and the importance of maintaining a good credit history.
The dangers of debt: Learn about the types of debt (student loans, credit cards, etc.) and how to avoid high-interest loans.
Understand student loans: If you're planning to attend college, know the difference between federal and private loans, interest rates, and repayment options.
3. Start Saving and Building an Emergency Fund
Open a savings account: If you don’t have one yet, this is an easy first step. Look for an account with no fees and the best interest rates.
Build an emergency fund: Aim to save at least $500–$1,000 to cover unexpected expenses.
4. Explore Investing
Learn the basics of stocks and bonds: Understand the difference between short-term and long-term investments, and the concept of risk versus return.
Start with simple tools: Apps like Acorns or Robinhood can help you understand investing with small amounts of money.
Understand compound interest: Learn how your money can grow over time through interest, especially in savings accounts or investment vehicles.
5. Track Your Financial Habits
Monitor your spending: Keep track of your daily expenses to identify areas to cut back or save.
Use financial apps: Apps like Mint, Personal Capital, or PocketGuard can automatically track your spending and give you a sense of where your money is going.
6. Educate Yourself Through Resources
Books: There are many books that can help build financial literacy. Some popular titles include Rich Dad Poor Dad by Robert Kiyosaki and The Total Money Makeover by Dave Ramsey.
Podcasts and blogs: There are podcasts like The Dave Ramsey Show and Planet Money, and blogs such as The Financial Diet or NerdWallet, which offer accessible financial advice.
YouTube Channels: Channels like Graham Stephan, The Financial Education Channel, and NerdWallet provide financial tips and advice for beginners.
7. Learn About Taxes
Understand basic tax terms: Research how taxes work, what a W-2 form is, and how to file taxes (you may have to do this if you get a job).
Learn how tax brackets work: Understand how income is taxed at different levels, and how tax deductions and credits can save you money.
8. Get Involved in Financial Education Programs
Take a class or workshop: Many schools, community centers, or organizations offer free or low-cost workshops on personal finance. Check with your high school or local library.
Explore online courses: Websites like Khan Academy and Coursera offer free courses on basic finance and budgeting.
9. Practice Financial Decision-Making
Evaluate purchases carefully: Before spending on non-essentials, consider the long-term impact of the purchase. Will it improve your life? Is it worth the cost?
Think about opportunity costs: Understand that every financial decision comes with trade-offs. If you buy something now, you might not be able to save or invest that money for the future.
10. Network and Ask Questions
Talk to financially literate people: Speak with family members, mentors, or friends who have a good grasp of financial matters. Ask them questions about their financial habits and experiences.
Seek out professional advice: If you’re unsure about your financial situation, talk to a financial advisor (some offer free consultations).
Starting early with these steps can give you a solid foundation for managing your finances as you transition into adulthood. It may seem overwhelming at first, but taking it step by step will help you gain confidence and control over your financial future.
Good luck! Please reach out if you have any additional questions!
1. Learn the Basics of Budgeting
Understand income vs. expenses: Know how to track what you earn (if you have a part-time job or any savings) and how much you spend.
Create a budget: There are simple apps like Mint, YNAB (You Need A Budget), or even just a spreadsheet to help you manage money.
Set financial goals: Set short-term and long-term goals, like saving for college, buying a car, or having an emergency fund.
2. Understand Credit and Debt
Learn about credit scores: Understand how credit works, how to check your credit score, and the importance of maintaining a good credit history.
The dangers of debt: Learn about the types of debt (student loans, credit cards, etc.) and how to avoid high-interest loans.
Understand student loans: If you're planning to attend college, know the difference between federal and private loans, interest rates, and repayment options.
3. Start Saving and Building an Emergency Fund
Open a savings account: If you don’t have one yet, this is an easy first step. Look for an account with no fees and the best interest rates.
Build an emergency fund: Aim to save at least $500–$1,000 to cover unexpected expenses.
4. Explore Investing
Learn the basics of stocks and bonds: Understand the difference between short-term and long-term investments, and the concept of risk versus return.
Start with simple tools: Apps like Acorns or Robinhood can help you understand investing with small amounts of money.
Understand compound interest: Learn how your money can grow over time through interest, especially in savings accounts or investment vehicles.
5. Track Your Financial Habits
Monitor your spending: Keep track of your daily expenses to identify areas to cut back or save.
Use financial apps: Apps like Mint, Personal Capital, or PocketGuard can automatically track your spending and give you a sense of where your money is going.
6. Educate Yourself Through Resources
Books: There are many books that can help build financial literacy. Some popular titles include Rich Dad Poor Dad by Robert Kiyosaki and The Total Money Makeover by Dave Ramsey.
Podcasts and blogs: There are podcasts like The Dave Ramsey Show and Planet Money, and blogs such as The Financial Diet or NerdWallet, which offer accessible financial advice.
YouTube Channels: Channels like Graham Stephan, The Financial Education Channel, and NerdWallet provide financial tips and advice for beginners.
7. Learn About Taxes
Understand basic tax terms: Research how taxes work, what a W-2 form is, and how to file taxes (you may have to do this if you get a job).
Learn how tax brackets work: Understand how income is taxed at different levels, and how tax deductions and credits can save you money.
8. Get Involved in Financial Education Programs
Take a class or workshop: Many schools, community centers, or organizations offer free or low-cost workshops on personal finance. Check with your high school or local library.
Explore online courses: Websites like Khan Academy and Coursera offer free courses on basic finance and budgeting.
9. Practice Financial Decision-Making
Evaluate purchases carefully: Before spending on non-essentials, consider the long-term impact of the purchase. Will it improve your life? Is it worth the cost?
Think about opportunity costs: Understand that every financial decision comes with trade-offs. If you buy something now, you might not be able to save or invest that money for the future.
10. Network and Ask Questions
Talk to financially literate people: Speak with family members, mentors, or friends who have a good grasp of financial matters. Ask them questions about their financial habits and experiences.
Seek out professional advice: If you’re unsure about your financial situation, talk to a financial advisor (some offer free consultations).
Starting early with these steps can give you a solid foundation for managing your finances as you transition into adulthood. It may seem overwhelming at first, but taking it step by step will help you gain confidence and control over your financial future.
Good luck! Please reach out if you have any additional questions!
Updated
Teri’s Answer
Hi Madison,
In simple terms:
Get familiar with tracking your cash/savings and expenses, and setting goals for the future (saving for college, paying off student loans by a certain date, starting a savings account for future retirement, a home, big trip, etc). Then start investing to save for the future and ensure you can meet your goals.
Couple places to start learning and get advice/help (I'm not affiliated with these what-so-ever):
- www.thrivent.com
- Acrons.com has a great app for your phone to start learning how to invest and track
Highly recommend opening a high yield savings account while interest rates are still high to grown your savings -- these are free, make sure no daily or monthly limits of $ you must have in them (I like www.synchrony.com & www.discover.com -- look at their high yield savings accounts; both have easy-to-use apps for tracking/adding/moving your money).
You'll feel so empowered and more confident having an understanding about your finances -- congrats on thinking of this now. You're off to a great start for your future!
In simple terms:
Get familiar with tracking your cash/savings and expenses, and setting goals for the future (saving for college, paying off student loans by a certain date, starting a savings account for future retirement, a home, big trip, etc). Then start investing to save for the future and ensure you can meet your goals.
Couple places to start learning and get advice/help (I'm not affiliated with these what-so-ever):
- www.thrivent.com
- Acrons.com has a great app for your phone to start learning how to invest and track
Highly recommend opening a high yield savings account while interest rates are still high to grown your savings -- these are free, make sure no daily or monthly limits of $ you must have in them (I like www.synchrony.com & www.discover.com -- look at their high yield savings accounts; both have easy-to-use apps for tracking/adding/moving your money).
You'll feel so empowered and more confident having an understanding about your finances -- congrats on thinking of this now. You're off to a great start for your future!
Updated
Rebecca’s Answer
Thank you for your question. I'm.glsd that you started thinking about financial management.
Firstly, you need to understand what you need and what you want
What is need- this is the expenses that is vital to you, eg school fee, transportation, etc.
What you want the expenses to buy something nice to have, eg jewellery, trendy sneaker, etc
You can then divide your income/pocket money into 3 portions:
1. Expenses on what you need
2. Saving
3. You can use it for what you want
Hope this helps! Good luck!
May Almighty God bless you!
Firstly, you need to understand what you need and what you want
What is need- this is the expenses that is vital to you, eg school fee, transportation, etc.
What you want the expenses to buy something nice to have, eg jewellery, trendy sneaker, etc
You can then divide your income/pocket money into 3 portions:
1. Expenses on what you need
2. Saving
3. You can use it for what you want
Hope this helps! Good luck!
May Almighty God bless you!
Updated
deborah’s Answer
Hello Madison! I applaud you for wanting to be better prepared before you graduate high school.
It looks like some very helpful learning resources have been shared already. So, I will share a few pieces of practical advice.
1. Budget - A budget is a plan on how you will allocate your monthly income to expenses and savings. From there you will use this Budget to make decisions through budget-driven spending and saving. The first savings goal should be Emergency Savings to avoid using high-interest credit cards in these situations. There are budgeting apps like YNAB (you need a budget). Nerd Wallet has a useful budgeting spreadsheet. https://www.nerdwallet.com/article/finance/budget-worksheet
2. Track all expenses to ensure you stay on budget. If you have not budgeted it, don’t spend it.
3. Make savings and investment goals using SMART Goals method. https://smartasset.com/financial-advisor/smart-financial-goal-examples
4. Build Credit carefully. A car loan is typically a good way to establish credit. This will help you get favorable terms for future loans such as a home. Also, always pay bills on time. Setting up automatic bill pay can be a helpful tool for on time payments.
Good luck!
It looks like some very helpful learning resources have been shared already. So, I will share a few pieces of practical advice.
1. Budget - A budget is a plan on how you will allocate your monthly income to expenses and savings. From there you will use this Budget to make decisions through budget-driven spending and saving. The first savings goal should be Emergency Savings to avoid using high-interest credit cards in these situations. There are budgeting apps like YNAB (you need a budget). Nerd Wallet has a useful budgeting spreadsheet. https://www.nerdwallet.com/article/finance/budget-worksheet
2. Track all expenses to ensure you stay on budget. If you have not budgeted it, don’t spend it.
3. Make savings and investment goals using SMART Goals method. https://smartasset.com/financial-advisor/smart-financial-goal-examples
4. Build Credit carefully. A car loan is typically a good way to establish credit. This will help you get favorable terms for future loans such as a home. Also, always pay bills on time. Setting up automatic bill pay can be a helpful tool for on time payments.
Good luck!
Updated
Darya’s Answer
Hi, Madison! Congratulations on graduating from high school and on your interest in improving financial literacy! Financial literacy is crucial for managing your money effectively, especially when making the transition to higher education or a job. Here are some steps you can take to improve your financial literacy.:
1. Educate yourself
- Online Courses, different platforms offer free or low-cost personal finance courses. Look for courses on budgeting, savings, lending, student loans, and investing.
- Try to read basic books on personal finance, such as:
1. "Rich Dad, Poor Dad" by Robert Kiyosaki
2. "The Total Money Makeover" by Dave Ramsey
3. "The Simple Path to Wealth" by J.L. Collins
- Podcasts and YouTube channels, there are many resources available where experts discuss financial topics in a fascinating way. Look for personal finance podcasts or YouTube channels.
2. Understand budgeting.
- Start by tracking your income (for example, any benefits, income from work) and expenses. Use applications like Mint, YNAB (you need a budget), or even a simple spreadsheet.
- The 50/30/20 Rule: this budgeting rule suggests spending 50% of your income on needs, 30% on satisfying desires, and 20% on savings and debt repayment.
3. Learn more about saving and investing
- Understand the importance of saving and find a high-yield savings account to increase your money.
- Familiarize yourself with the basic investment concepts. Learn about stocks, bonds, mutual funds, and ETFs. Learn how compound interest works, as well as the basics of risk and diversification.
- Understand the importance of retirement savings even at a young age. Learn about accounts like 401(k) and IRA.
4. Credit and debt management
- Learn about how credit ratings are calculated and why they are important. Strive to get a good loan by responsibly managing debts, if you have any.
- If you plan to take out student loans, explore the different types, interest rates, repayment options, and ways to avoid debt traps.
5. Practice in real life situations.
- Look for apps or online simulations to help you practice money management in realistic scenarios. This provides a hands-on learning experience.
- If you have a job, practice managing your salaries according to your budget. Keeping records of income and expenses gives you hands-on experience.
6. Ask for advice
- Talk to adults, contact family members or mentors who understand personal finances. Check out their experience.
- Many secondary schools have career counselors or financial advisors. Consult with them if they offer financial literacy programs or seminars.
7. Networking and public engagement
- Attend seminars organized by local banks, local colleges, or non-profit organizations. They often cover budgeting, savings, and investing issues.
- Look for financial literacy clubs or investment clubs in your school or place of residence.
8. Stay informed about events
!! Keep an eye on personal finance websites, blogs, or magazines (such as Forbes, The Motley Fool, or NerdWallet) to keep up to date with financial trends and tips.
Developing financial literacy is a lifelong journey. The more active you are now, the better prepared you will be to make financial decisions in the future. Start small, be consistent, and always look for opportunities to learn more. Good luck! With love, Darya
1. Educate yourself
- Online Courses, different platforms offer free or low-cost personal finance courses. Look for courses on budgeting, savings, lending, student loans, and investing.
- Try to read basic books on personal finance, such as:
1. "Rich Dad, Poor Dad" by Robert Kiyosaki
2. "The Total Money Makeover" by Dave Ramsey
3. "The Simple Path to Wealth" by J.L. Collins
- Podcasts and YouTube channels, there are many resources available where experts discuss financial topics in a fascinating way. Look for personal finance podcasts or YouTube channels.
2. Understand budgeting.
- Start by tracking your income (for example, any benefits, income from work) and expenses. Use applications like Mint, YNAB (you need a budget), or even a simple spreadsheet.
- The 50/30/20 Rule: this budgeting rule suggests spending 50% of your income on needs, 30% on satisfying desires, and 20% on savings and debt repayment.
3. Learn more about saving and investing
- Understand the importance of saving and find a high-yield savings account to increase your money.
- Familiarize yourself with the basic investment concepts. Learn about stocks, bonds, mutual funds, and ETFs. Learn how compound interest works, as well as the basics of risk and diversification.
- Understand the importance of retirement savings even at a young age. Learn about accounts like 401(k) and IRA.
4. Credit and debt management
- Learn about how credit ratings are calculated and why they are important. Strive to get a good loan by responsibly managing debts, if you have any.
- If you plan to take out student loans, explore the different types, interest rates, repayment options, and ways to avoid debt traps.
5. Practice in real life situations.
- Look for apps or online simulations to help you practice money management in realistic scenarios. This provides a hands-on learning experience.
- If you have a job, practice managing your salaries according to your budget. Keeping records of income and expenses gives you hands-on experience.
6. Ask for advice
- Talk to adults, contact family members or mentors who understand personal finances. Check out their experience.
- Many secondary schools have career counselors or financial advisors. Consult with them if they offer financial literacy programs or seminars.
7. Networking and public engagement
- Attend seminars organized by local banks, local colleges, or non-profit organizations. They often cover budgeting, savings, and investing issues.
- Look for financial literacy clubs or investment clubs in your school or place of residence.
8. Stay informed about events
!! Keep an eye on personal finance websites, blogs, or magazines (such as Forbes, The Motley Fool, or NerdWallet) to keep up to date with financial trends and tips.
Developing financial literacy is a lifelong journey. The more active you are now, the better prepared you will be to make financial decisions in the future. Start small, be consistent, and always look for opportunities to learn more. Good luck! With love, Darya