Building Financial Awareness
- Financial Education
- Adapted from GreenPath Financial Wellness
With many COVID-related relief programs ending, being financially aware is more important now than ever. Yet being financially aware goes well beyond managing everyday bills and expenses.
As we prepare for National Financial Awareness Day coming up on August 14, now’s a good time to assess your financial awareness and look for ways you may be able to improve. Here are five signs of becoming financially aware:
1. You put your goals in writing.
People with written goals are more likely to achieve them. It entails envisioning what you see for yourself and then using that goal as the momentum to make it a reality. Financial goals can be both short-term and long-term. A short-term goal may be that you plan to pay off debt, whereas a long-term goal may be saving up enough money to buy a house. Financially aware people make sure to revisit their goals at least once every 3-4 months and make adjustments when needed.
2. You use a budget.
Many people see budgeting as a distasteful duty. And it can seem that way if you are trying to correct years of financial problems in one day. But really a budget is just a financial blueprint that shows income and expenses on a monthly basis. For the financially aware, a budget helps people make informed decisions as to where your money goes.
3. You’re building an emergency fund.
Having an emergency fund to manage unforeseen circumstances can mean the difference between a financial disaster and a minor setback. When you’re financially aware, you plan for the unexpected. Depending upon your budget, you can determine a set amount to put into a savings account from each paycheck. Some financially aware people have their employer directly deposit part of their paycheck into a savings account. Over time, you can build a budget buffer.
4. You work to get a handle on debt.
Debt is borrowing money you haven’t earned yet. It’s a useful way to manage finances, as long as you have a plan to pay off your balances. When you’re financially aware, you obtain low interest loans to achieve certain financial goals – like buying a house or car, or getting a student loan so you can further your education. You stay current with high interest credit cards that can become difficult to pay back if your financial circumstances change unexpectedly. Depending upon your situation, there may be options to get out of debt more quickly. Financially aware people might consider a debt management plan to get a handle on any outstanding debt.
5. You check your credit report and score.
Financially aware people keep tabs on credit history, which is used to calculate your credit scores – those three-digit numbers that help determine whether lenders will approve you for new credit and what interest rates they’ll charge you. Annualcreditreport.com is a “one stop shop” to check your reports from Experian, Equifax, and TransUnion – the three industry standard credit bureaus. You can get a free copy of each report once a year.
Build Your Financial Awareness
Financial awareness starts with information, and we all make the best decisions we can with the resources we have available to us. We’ve partnered with GreenPath Financial Wellness to provide free financial counseling and education for Frontwave Credit Union Southern California Members. Their certified financial counselors can provide information on building your financial awareness, improving your credit score. managing debt, and more. Request your free counseling session today at greenpath.com/Frontwave or by calling 877.337.3399.
This article is adapted from information provided by our partners at GreenPath Financial Wellness, a trusted national non-profit.