Since April 2003, the United States has recognized April as Financial Literacy Month. As such, for 30 days, financial literacy educators and organizations alike focus their content and energy to highlighting the importance of economic and financial literacy. Such efforts are crucial for financial illiteracy and a lack of financial preparedness can have damaging effects, such as increased debt, dwindling retirement funds and Social Security, higher tax burdens, and rising unemployment. Moreover, for disenfranchised individuals, which includes poverty-stricken and working-class individuals, the effects of financial illiteracy can be twice as crushing. Finally, for these demographics, the rate at which funds are saved are below average. Thus, it is important that continue to raise awareness about the necessity of financial education and continue to highlight the positive outcomes.
Reflecting further on the various topics that encompass financial literacy, interest in investing has risen. As individuals work doggedly to manage budgets and pay off existing debt, pride in their money management skills swells. Likewise, investing is a sound fiscal practice for ensures both short- and long-term financial success. When properly researched and done correctly, profits from investing are plentiful which serves another stream of income. Therefore, for those looking to diversify their income and ultimately begin building a path for generational wealth, investing is encouraged. To provide insight on investing further, below you will find a March 27th Twitter #CreditChat centered on investing from Experian: Q1: What does it mean to invest? WW: To take earned income, or funds achieved by other methods, and place a percentage of it in property or shares in the hopes of receiving profit. #CreditChat Q2: Is investing a good idea? WW: Investing is a fantastic way of securing another stream of income as well as maximizing all that the market has to offer. #CreditChat Q3: Can you invest while you’re in debt? WW: You sure can! Although your top priority is to eliminate existing debt, which means half of earned income will probably be used to achieve this goal, start small if you are considering investing. #CreditChat Q4: What are the best types of investment? WW: 401k accounts, bonds (mutual and U.S. Savings bonds), Certificate of Deposit (CD) accounts, medium-level stocks, Roth IRA accounts, and more! #CreditChat Q5: When should you start investing? WW: As early as steady income has been earned. As such, if you are a recent college graduate, and are earning a steady flow of income, the time to start investing is now. Similarly, if you have forgone college, and have entered the workforce earlier in your journey, the time to start investing is now as well! #CreditChat Q6: How do you invest in stock? WW: With all things financial, employing the proper research skills in bonds, stocks, and mutual funds is key. While there is a plethora of information available, such information is presented often assuming that the reader is highly-knowledgeable on the topic. However, there are plenty of people who lack access and education on stocks, which should be at the forefront when creating and disseminating information. Nevertheless, finding easy-to-read guides and tips on investing and stocks is a helpful start. #CreditChat Q7: What is the difference between “saving” and “investing”? WW: Saving is setting aside funds to use at a later date. Investing requires one to buy bonds, mutual funds, or stocks that will (hopefully) mature and yield profit at a later date. #CreditChat Q8: What are some low-risk investment options? WW: My go-to options are always saving accounts and savings bonds. Again, with all fiscal options, it is important to find low-risk investments that best fit your intended goal and current income level. #CreditChat Q9: Does investing affect your credit score? WW: No, it does not! #CreditChat Q10: Any final tips on how to make your money grow? WW: Research, apply theories to practice, then practice patience. The road to financial success is slow, but the rewards are worth the wait! #CreditChat
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WhitneyEducation enthusiast whose mission it is to see Financial Literacy receive well-deserved shine. Archives
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