5 Ways to Celebrate National Financial Awareness Day
| Posted in Bank Blogs
When it comes to awareness days, the month of August is hot. There’s International Youth Day on August 12 and World Humanitarian Day on August 19.
In the world of personal finance, there’s one important day in between you should know about –National Financial Awareness Day on August 14. This annual event was created to remind individuals and families about the importance of managing money and promoting good financial habits and health.
Here are some ways you can celebrate National Financial Awareness Day and give your money the love and care it deserves:
- Create a budget. Budgeting is critical to sound financial management. If you haven’t already done so, create your monthly budget by tracking your expenses. Once you know where your money is going, categorize your spending into “needs” and “wants” and look for ways to reduce your spending. Needs are mandatory expenses, like your rent or mortgage, and wants could be dining out or streaming services. You can create your budget on a spreadsheet or use a budgeting app. Once you create your budget, track your spending, and adjust accordingly.
- Build an emergency fund. From home repairs to job loss, unexpected financial challenges happen in life. Yet, nearly ¼ of Americans have no emergency savings to prepare for them. Having 3 to 6 months of living expenses saved in an emergency fund can provide peace of mind and protection if an unexpected life or financial circumstance should happen to you. If you don’t have an emergency fund, review your budget and determine how much you could save by cutting down other expenses. Then, arrange to have that money automatically deposited or transferred to your emergency savings account each month. Also, if you get a tax refund or bonus, use it toward your emergency fund. You’ll be amazed at how quickly your funds will add up.
- Manage your debt. Carrying credit card balances with high-interest debt? Make debt reduction a priority by paying more than the minimum monthly payment. If you have multiple credit cards, pay down the cards with the highest interest rates first. Avoid buying anything you can’t afford to pay for in cash.
- Save for retirement. It’s never too early or too late to start saving for retirement. If your company offers a retirement plan, enroll in it, especially if they have matching contributions. If you don’t have access to a company retirement plan, you can open an Individual Retirement Account (IRA) and set up monthly automatic deposits.
- Boost your credit score. A strong credit score can help you qualify for loans to reach long-term goals, like buying a car or house. It can also ensure you get lower interest rates on loans, which can free up room in your budget. You can build your credit score by paying bills on time, reducing your credit balances, and keeping older credit lines open.A strong credit score can help you qualify for loans to reach long-term goals, like buying a car or house. It can also ensure you get lower interest rates on loans, which can free up room in your budget. You can build your credit score by paying bills on time, reducing your credit balances, and keeping older credit lines open.
Though Financial Awareness Day is in August, taking these important steps today can plant the seeds to financial wellness and security all year long – even on National Watermelon Day on August 3.