1. Financial Literacy:
Knowing What You Need
To Know To Achieve Your
Financial Goals

2. America’s financial literacy
- The Federal Reserve is looking at $2.4 trillion in
unsecured debt and the numbers keep rising.
- One in 10 consumers has more than 10 credit
cards.
- One in 50 households carry more than $20,000 in
credit card debt.
- The rise in the cost of living has outpaced income
growth over the past 12 years.

3. America’s financial literacy
• Two out of 3 households will probably fail to
realize life goals
• Financial illiteracy is passed to the next
generation
• Only five states require high school students
to take a class about money (VA is one of
them)

4. What is Financial Literacy?What is Financial Literacy?

5. Financial literacy
• The ability to effectively evaluate and
manage one’s finances in order to make
prudent decisions toward reaching life’s goals
• The understanding of:
- Money
- Cash flow
- Basic economic/financial concepts
- Debt/risk management

6. Achieving financial literacy
• Five Key Areas of Personal Finance:
- Money and income
- Money management
- Spending and debt
- Savings and investments
- Risk management

7. Money and income
• Time is money
• How many hours do you need to work to pay
for your mortgage, car insurance, electricity
bills, extras, etc?

8. Money management
• Budgeting
• Prioritizing

9. Spending and debt
• Benefits and costs of spending alternatives
• Credit as a basic financial tool

10. Savings and investing
• Saving means not spending money.
• Investing means that you earn a return on
the money you put into it.

11. Risk management
• Insurance
• Understanding the markets
- About 50% of Americans own stocks
• Identity theft

12. Financial literacy isn’t just
a matter of knowing what you
have and knowing your options.
It is a matter of planning for
life’s milestones.
Financial literacy isn’t just
a matter of knowing what you
have and knowing your options.
It is a matter of planning for
life’s milestones.

13. Creating your first
overall long-term financial plan
Creating your first
overall long-term financial plan

14. Buying your first home
• Establish good credit
• Understand “real costs”
• Assess risks

15. Getting married
• Understand “financial partnership”
• Establish separate and joint credit and bank
accounts
• Create wills and trusts
• Identify beneficiaries
• Choose owners on title assets

16. Financing a family
• Budget
- Education, health care, child care
• Manage risk, insurance
• Create wills
• Instill financial literacy

17. Starting a business
• Understand
- cash flow
- expense timing
• Manage income and expenses
• Taxes

18. Planning for Retirement
• Determine how much money you will need.
• Determine where your retirement income will
come from.
• Devise a budget and investment strategy to
help you meet your goals.

19. Preparing a will
• Designate beneficiaries
• Determine asset distribution
• Identify insurance

20. Unexpected milestones
• Loss
• Sandwich generation
• Divorce

21. Financial literacy education
• Lifelong learning courses
• Financial media
• Internet resources
• Your CPA

22. For more information
www.360financialliteracy.org features financial
education to help consumers at every life stage.

23. Financial Literacy:
Knowing What You
Need To Know To Achieve
Your Financial Goals
Financial Literacy:
Knowing What You
Need To Know To Achieve
Your Financial Goals

24. QUESTIONS