April is Financial Literacy Month. While it also includes the deadline for filing income tax, it can be a great time to plan for financial success.
In an article from Elizabeth Kiss, Kansas State University family resource specialist, she notes that this time also gives each of us an opportunity to think about money differently and to consider actions to use it wisely.
Kiss includes the following five principles for Americans to consider as they make day-to-day decisions about money. These are from the U.S. Government’s Financial Education and Literacy Commission (the U.S. Government’s Financial Education and Literacy Commission promotes five principles):
1) Earn. Make the most of what you earn by understanding your pay and benefits. For example, Kiss said, “we can talk about vacation pay or personal days off. If you’re not using those, that’s a benefit you’re leaving on the table and you’re not getting the rest and leisure that you’re eligible for.”
2) Save and Invest. “It’s never too early to start saving for future goals,” whether they are short, medium or long term, Kiss said. She noted that those with retirement accounts should also routinely review their accounts to make sure they are on track to meet their goals.
3) Protect. This includes making sure you have emergency savings, and that insurance plans provide adequate coverage for home, car and other property.
4) Spend. Be sure you are getting good value for your purchases. Shop around and compare, especially on big purchases. “And we might make choices on some things we’re going to splurge on, and some things we’re going to be more frugal on, and that’s totally alright,” Kiss said. “It’s about balance.”
5) Borrow. “Most of us have to borrow money to buy a house or other large purchase at some point,” Kiss said. Borrowing money and paying back loans helps to build credit. However, remember that borrowing money comes at price – paying interest. When you borrow, you repay the debt and pay interest.
Everyone manages their finances differently and these principles are a place to start. Sometimes, just having a frank conversation within your household about financial priorities and goals can be a tough, but necessary, part of the process.
Additionally, the publication How Are You Doing? A Financial Checkup is available from the K-State Extension bookstore. Let me know if you need more information about this or other financial planning tools.
Keep learning. Keep showing grace and kindness!
Michelle Beran is a Family and Community Wellness Agent in the Cottonwood Extension District. For more information on this article or other K-State Extension resources, email Michelle at mberan@ksu.edu or call Cottonwood Extension District – Barton Office at 620-793-1910
