Written by Ray'Chel Wilson, CFEI®, a Toledo native, is the author of the Black Wealth Freedom series and CEO of Raise the Bar Investments, all things minority-friendly personal finance, #ForOurLastNames. Ray’Chel is an advisory board member of the Phe’Be Foundation, a Cleveland-based nonprofit fighting financial illiteracy across age ranges.
April is National Financial Literacy Month, a time to focus on the importance of financial education and improving our financial literacy skills. With the impact of the pandemic still affecting the economy and many individuals struggling to make ends meet, it's more crucial than ever to prioritize financial wellness.
Here are three actions you can take to advocate for and improve your financial wellness:
Educate Yourself on Financial Literacy
Financial literacy means having the knowledge and skills to manage your money effectively, make informed decisions about spending, saving, and investing, and avoid financial pitfalls. However, studies show that many Americans lack basic financial literacy skills, leading to poor financial decisions and high levels of debt.
Take the time to educate yourself on financial literacy, regardless of your income level. Start by understanding the fundamentals of budgeting, debt management, credit scores, and investments. There are plenty of free online resources and tools available that can help you improve your financial knowledge, such as personal finance blogs, podcasts, and books.
Consider taking a financial literacy course or workshop at your local community college or community center. Many organizations offer free or low-cost financial education programs, and you can learn valuable skills that can help you achieve your financial goals.
Practice Good Financial Habits
Once you've gained some financial literacy, the next step is to put that knowledge into practice. Good financial habits can help you build wealth, avoid debt, and achieve financial stability over time.
Here are some key financial habits to cultivate:
Create a budget: A budget is a spending plan that helps you manage your money and track your expenses. Start by calculating your monthly income and expenses, and allocate your money accordingly. A budget can help you identify areas where you can cut back on expenses and save more money.
Pay off debt: High levels of debt can be a significant obstacle to achieving financial wellness. If you have credit card debt, student loans, or other forms of debt, make it a priority to pay off your balances as quickly as possible. Consider consolidating your debts or negotiating with your lenders to lower your interest rates.
Build an emergency fund: Life is unpredictable, and unexpected expenses can derail your finances. Having an emergency fund can provide a safety net when you need it most. Aim to save at least three to six months' worth of living expenses in a separate savings account.
Advocate for Financial Literacy
Financial literacy is not just an individual issue; it's a societal one. Lack of financial literacy can contribute to economic inequality, as those with lower incomes and less education are more likely to face financial hardship.
Advocate for financial literacy in your community by:
Supporting financial education programs: Encourage local schools, community centers, and organizations to offer financial education programs. Attend workshops and classes, and share your knowledge with others.
Engaging with policymakers: Contact your elected officials and advocate for policies that support financial literacy and economic empowerment, such as increasing funding for financial education programs and regulating predatory lending practices.
Volunteering with organizations that promote financial wellness: Many nonprofit organizations offer financial education and counseling services to low-income individuals and families. Consider volunteering your time and skills to help others improve their financial literacy and achieve their financial goals.
In conclusion, financial literacy is a critical skill that can help you achieve your financial goals, build wealth, and avoid debt. By educating yourself on financial literacy, practicing good financial habits, and advocating for financial wellness in your community, you can make a positive impact on your own finances and the lives of those around you. Let's celebrate National Financial Literacy Month by taking action towards improving our financial futures.
PS - Did you know Cleveland will have its own Wealth Wellness Weekend this summer? Mark your calendars for Juy 21-23! Visit www.phebefoundation.org or follow @thephebefoundation on Instagram to stay up to date!
Affirm: I can be the change I desire.