What is Financial Literacy?

Hi it's your girl  JA Nursing here,   As we start counting downs the days for 2016. 
Some of you may look forward to seeing a New Year or it could have some of us thinking about   all of our financial woes.  Over the years I can certainly admit to  finding myself in some financial traps, especially during  my College years.   Ohhh lord, you want to talk about a living death trap for years it had me feeling like putting a curse on all  Collection Agents. 

Financial literacy is just as important as  health Literacy. Just the thought of having a  50 year span Between high school and retirement to plan for  financially security can seen scary for many.  One thing that people  don't know about me is that I am a Mobile Paramedical Examiner. What is that you ask?  I  work for all insurance companies doing the written medial exams which is the first step needed in order to get insurance of any kind.  I am a firm believer in getting insurance sooner rather than latter.    I might add that insurance policies are a good way to start your financial journey. My insurance policy was the one thing that my Welfare worker always questioned.  For many especially if you are on a fixed income paying that $65 dollars a month can seem like a bill that you can miss but, word of advise the older you get the harder it is to get insurance.   Having my first child at 17, meant  that I had to learn real quick about money management especially since I was on a fixed income   Social Assistance (WELFARE). 

The reason for this blog is because over the years I have met many people  that  ask me how I did it? I always say did what? well of course people perceive   success based upon  what you have.  House, cars, and clothes tend to be  how people judge  your success. Guess it gives the notion that you made it.  But truthfully if you don't own any of theses things then how can it be true riches???    Someone said to me this week  that the  difference  between successful and unsuccessful people is Information. So lets share some information.

Whether you're in high school or in retirement, every person in every stage of life should have an understanding of how their finances work.  This understanding, or awareness, is what helps build and improve what is known as your "Financial Literacy." 
Not all strategies for financial planning are created equal, and the “right” approach to managing your money will actually change as you go through life. Your goals and priorities will shift as you get older, and it’s important to plan appropriately. Let's focus on a few key tasks appropriate to your stage of life and you are likely to find yourself ahead of the game. 

Here are some simple, key strategies for managing your finances in your 20s, 30s, and 40s.  I always make sure to  follow the advice of my  friends over at Practical money skills. Which is  to Live Within My Means.
If you are like many Canadians, you may find that you are spending more than you're saving and steadily going deeper into debt as a result. This is an easy and common pattern to fall into, and one that requires some planning and discipline to reverse.
The first step is creating a budget. As unpleasant as this may sound, creating a budget is nothing more than looking at what you make verses what you  spend your income and expenditures in order to determine exactly how much money you have coming in and where you’re spending that money.
Once you've got a clear understanding of your current budget, your challenge is to find places where you can spend less (or earn more) in order to achieve your financial goals. Here are some steps you can take toward that end:

1. Question Your Needs And Wants

What do you want? What do you really need? Your wants are basically the things you can do without — everything from that high-end tennis racquet to dinner out at a gourmet restaurant. Wants are purchases that, while they may make your life easier or more enjoyable, are not necessary to your well being. Your needs, on the other hand, are not quite so flexible. They are necessary financial obligations such as housing and food costs. Evaluate your current financial situation. Take a look at the big picture. Make two lists – one for needs and one for wants.
As you make the list, ask yourself:
  • Why do I want it?
  • How would things be different if I had it?
  • What other things would change if I had it? (for better or worse)
  • Which things are truly important to me?
  • Does this match my values?

2. Set Guidelines

We all have different budgets based on our needs and wants. But the Building a Budget chart on the next page shows some guidelines on how much should go toward different expenses. You may need to make adjustments for a daily latte fix or visits to family, but remember to subtract amounts from other areas if you do.

3. Track, Trim And Target

Once you start tracking, you may be surprised to find you spend hundreds of dollars a month on eating out or other flexible expenses. It may become obvious that you need to cut back in certain areas.
Some types of expenses are more easily trimmed than others. Some of these are easily trimmed. Cutting back is usually a better place to start than completely cutting out.  
Be realistic. It will help you to be better prepared for unexpected costs. Once you have gotten into the rhythm of living your life on a budget, you will notice all kinds of spin-off effects. In the short term, you won’t feel as much stress when your bills arrive. In the long term, you may find yourself heading for a more secure financial future.

Quick Tip for all ages-- Also remember  that teaching your young children about money management and budgeting  is one of the most valuable lessons that  will change outcomes for a life time.
Teaching your kids how to create a budget is one of the most valuable skills you can impart in the years before they leave home. - See more at:

Teaching your kids how to create a budget is one of the most valuable skills you can impart in the years before they leave home. - See more at:

In Your 20s
1. Start an emergency fund.
Set up an automatic deduction of $25 from every paycheck and deposit it in a separate account. This way you can gradually build a cushion for unexpected expenses. You’re less likely to fall into debt if you have money tucked away for emergencies.  for example. It might seem like a lot of money at first, but it’s just a small lifestyle shift each month. Consider cutting back on a latte or cocktail each week to meet your monthly goal.

2. Establish your personal credit.
Building a strong credit history is important if you want to rent an apartment or get a mortgage.  This lesson was my hardest lesson. After OSAP and College this fact is one that becomes the biggest lesson for many people, the first opportunity to build good credit comes from taking out (and repaying) undergraduate student loans. If you make that payment on time each month, you’ll contribute positively to your credit score and history. If you don’t, it can have a  big impact on your feature. If there’s any chance you may be late on payments, set up  transfers between accounts so you’re sure you make those payments on time every month.

In Your 30's
1. Get a great deal on a mortgage.
For many 30-somethings still paying off student loan debt, home buying can feel like an impossible venture. However it can be your best first step in building your portfolio. For example even though the lesson passed me I encouraged my Nephew to get a income property when he was 26, now is has 2 income properties before the age of 30.

2. Save for retirement.
If you haven’t started participating  in establishing an investment do it now! The sooner you start, the more you can save. Ask your bank or  Financial Planner

3. Pay down personal debt.
Financial decisions you made in your 20s need not haunt you indefinitely. Get out from under the burden of high-interest credit card debt now so you can breathe easier. Instead of opting for a balance transfer to a lower-interest card, consider using a low-interest-rate personal loan to refinance that debt  or Apply for a Line Of credit — saving money and quashing the temptation to spend.

In Your 40's
1. Refinance your mortgage.
If you have a mortgage, your credit score may have improved since you took it out. It could be a good time to shop for a better deal and refinance. Today’s modern refinancing options are more convenient and user-friendly than ever before.
2. Amp up your retirement savings.
If you’re not contributing the maximum amount  plan, now is a good time to get serious about saving. If you’re married, make sure you’re both contributing as much as you can each month, and maxing out your contributions by the end of the year.

3. Save for your children’s education.
I have often  said my contribution to my children will be helping them reach their educational goals by helping them to pay for  Post Secondary education. But  encourage your children to get summer jobs and save to.  The  investment of education can only be a  benefit. Don't Stop Learning!
Save enough and your children may never have to take out student loans. Look into professional lines of credit   to help with schooling rather than student loans from OSAP.

Manage Debt. If you're in debt, you're not alone. Start out by making a list of everything you owe, whether it's a credit card, student loans or a mortgage. Reducing debt is like losing weight. You're not going to lose 50 pounds in a month. You need realistic goals in reasonable time frames.
Prepare for the Unexpected. There's nothing harder to plan for than the unexpected. The key to successfully surviving these life-changing events, financially at least, is to anticipate hard times. Build an emergency fund that is easy to access in the event of unemployment, illness or a major unplanned expense. Experts recommend saving three to six months of living expenses. Need help figuring out how much to put aside for your emergency fund? Check out this calculator from Practical Money Skills.

Bottom line:    Ring in the New Year with financial resolutions that will help you save, spend and invest smarter in the coming year.

This has been your Social Buzz with Michelle Smith  your  Health and Social Advocate. Financial literacy is an integrated  approach to keeping  up with your mental wellness. Find out more about my collaborative programs for youths. Remember  lessons are best learned when the example seems achievable.    2016 is going to be a Great Year

  The reality is wealth is a form of delayed gratification. Wealth builders live modestly by spending less than they can afford (in money, time, and energy), so they can invest the difference for greater value in the future
Wishing you all a Happy New Year  stay connected  

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