The term 'financial literacy' may already be familiar to the ears. You may also already understand the meaning of the term. Launching from The Balance page, financial literacy basically refers to the skills you may need when making choices about what to do with the money you have.
A simple analogy, suppose a person has an income of about ten million per month. People who are financially literate will not spend all their money, even they still feel deprived to the point of being forced into debt for consumptive needs.
The money will be managed properly so that the person will not run out of money and can even play it so that income increases.
So, now the question is, are you someone who is financially literate? If you believe you are financially literate then you may have the following characteristics.
Doing Budgeting
Many still underestimate budgeting, aka making a budget. No matter how small your income, making an expense budget cannot be underestimated.
Launching from the Investopedia page, if you and your family want financial security, budgeting is the only answer. Not without reason, because budgeting helps ensure you don't spend money on things you don't really need.
If you currently have a budgeting habit, then you are one of the many people who are already financially literate.
Saving Discipline
We all know that saving is a good habit that may have been instilled from an early age. People who are financially literate usually have these good habits.
They certainly don't have to wait for any remaining expenses before saving. In fact, once they get a salary, they immediately set aside a certain percentage for savings.
Not only savings, they even set aside part of their income for an emergency fund. These funds will be very meaningful when you face an unwanted situation such as termination of work or an accident.
Start Investing
Not waiting to have a lot of money or a high position, someone who is already financially literate usually has started investing even in small amounts first. Investment is considered profitable because it can prevent savings from inflation.
Even through investment, you can increase your income even if not in a short period of time. Especially now you can invest in various forms such as stocks or gold. But make sure you invest safely and legally.
Have a Clear Financial Plan
The money you earn doesn't just run out to be spent, saved, and invested. Those of you who are financially literate usually have a clear plan for what you have. For example, you have a goal of using it for business capital, to build a house, or for wedding preparations, for example.
Without a clear plan, the possibility of realizing your goals is rather difficult to realize. Moreover, launching from the Savology page, having a financial plan can be a strong source of motivation and commitment to realizing the financial goals you hope for.
Have Insurance
Currently, there are many types of insurance, such as health insurance, life insurance, education insurance, old-age insurance, and many other types. You may be the one who has one or more of these types of insurance.
This indicates that you are financially literate because you remember the benefits that you can get from having insurance. The insurance that you have can provide protection from possible financial losses that may occur in the future. That way, you will be calmer because it is guaranteed.
So, those were some of the characteristics of someone who is financially literate. I hope you are one of them, huh?