5 Components of Basic Financial Literacy

5 Components of Basic Financial Literacy

April is Financial Literacy Month, and there is so much to celebrate. The reason is because properly managing your finances can keep you out of debt and help you save money. 

In this article, we’ll discuss the 5 components of financial literacy and provide helpful links on each topic. From there, you’ll learn how to manage your funds to support your monetary well-being. Ready to get started? Continue reading for the full details!

1. Budgeting

Budgeting is a crucial aspect of managing your finances. It involves keeping track of the money you earn as income and the money you spend on expenses. Using tools like automatic bill pay can reduce fees from missed or late payments and ensure your budget stays on track. Furthermore, setting up direct deposit with your employer can make it easier to manage your income by having it sent directly to your checking or savings account based on your preferences.

2. Building and improving your credit

Your credit score is vital if you ever desire to borrow money in the future. While several factors make up your credit profile, having a general understanding of the actions that affect it will preserve your rating and lending opportunities. To learn what makes a good credit score, view our related article.

3. Borrowing and repaying debt

Everyone needs a little help from time to time. Also, borrowing becomes necessary to purchase large ticket items such as a new car or home. While considering the available loan options, knowing the difference between interest and APR can save you from repaying extra fees. It’s beneficial to compare the numbers before accepting the debt, and you should aim for the lender with the lowest overhead expenses. 

4. Saving

When it comes to savings, many wish they could do more. Why not make it easy by enrolling in an auto savings program? Achieva’s Saving for GOOD takes all your debit purchases and rounds the amounts to the nearest dollar. The amounts are then deposited automatically into a designated savings account, leaving you with an intentional way to build your funds. Visit your local branch or call 800.593.2274 to enroll*.

5. Investing

Investing is buying financial assets with the potential to increase in value. There are long-term and short-term investments. However, the quicker turnarounds usually exude the most risk. The most common investments are stocks, bonds, real estate, and mutual funds. 

We recommend talking to an Achieva Wealth Advisor before investing. 

Develop your financial literacy 

If you want to develop your financial literacy even further, we offer free online courses throughout the year. Check our events calendar for topics and dates of upcoming Achieva Cash Classes.


Need more financial content? Continue following the Achieva Life Blog for additional budgeting and lifestyle articles.

*Insured by the NCUA


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