We learn how to read in school, but when do we learn how to read and understand a bank statement or a credit card offer? Financial literacy, to me, means a life-long process of figuring out how to handle money well. Simple, right? Here are some other ideas.
The President's Advisory Council on Financial Literacy defines personal financial literacy as "the ability to use knowledge and skills to manage financial resources effectively for a lifetime of financial well-being." (2008 Annual Report to the President)
The financial literacy definition developed by the National Financial Educators Council (NFEC):
Possessing the skills and knowledge on financial matters, to confidently take effective action that best fulfills an individual’s personal, family and global community goals.
The NFEC states “A lot of people know what they should do; however a good majority freeze up when it comes time to make a financial decision. Most have the knowledge but lack the confidence to make the right decision and take action in a decisive manner. Since money is directly tied to peoples emotional state we feel including this component in our financial literacy definition is critical.” [emphasis mine]
This blog is dedicated to helping you to improve your financial literacy, for your well-being, and for the next generation. That's why the company is called MultiGenerational--it's important to pass it on.
Just your reading this is an act of working on your financial literacy, so, yay! If you'd like, let me know what your definition of financial literacy is, in the comments!
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