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April is Financial Literacy Month

April is Financial Literacy Month, a month dedicated to raising awareness and understanding how to save, earn, borrow, invest, and protect your money wisely. Major financial decisions, like financing higher education, incurring debt, or saving for retirement, can have lasting consequences if done incorrectly.

“Not having enough money for retirement and not being able to pay for medical care in the event of a serious illness or accident are the most worrisome of eight financial issues for Americans.”1

When is Financial Literacy Month?

National Financial Literacy Month, also known as Financial Capability Month, runs from April 1 to April 30 each year.

What is financial literacy?

Financial literacy is the ability to understand how to make smart decisions with money such as personal financial management, budgeting, and investing. Educating yourself on these topics also involves learning how money works, setting and achieving financial goals, and managing the financial challenges that life throws your way.2

Why is financial literacy important?

Financial literacy is important because it enables people of all ages to set goals and make smart decisions to protect their hard-earned income. A strong foundation of financial literacy can help support various life goals, such as saving for retirement or running a business.

Components of financial literacy

According to the US Financial Literacy and Education Commission, there are five components of financial literacy3:

  1. Earn
  2. Save and invest
  3. Protect
  4. Spend
  5. Borrow

The Earn Principle

The Earn Principle is about making the most of what you earn by understanding your pay and benefits. When it comes to earning, you can:

  • Learn about the details of your paycheck, including any deductions
  • Review the taxes that are withheld, including Social Security and Medicare taxes
  • Explore and sign up for workplace benefits
  • Invest in your future – with education and training.

The Save and Invest Principle

The Save and Invest Principle revolves around creating a habit of saving regularly, even saving small amounts of money, to plan for life events and be ready for unplanned or emergency needs.

Some things you can do to work on saving and investing include:

  • Track your savings and investments
  • Plan for short-term and long-term goals
  • Start saving and form a savings habit
  • Build up emergency savings for unexpected events
  • Consult with a qualified professional on investments and other key financial matters
  • Save for retirement, children’s education, and other major items

The Protect Principle

The Protect Principle focuses on taking precautions to protect your financial situation. It stresses the importance of accumulating savings in case of an emergency and buying insurance.

To help protect your hard-earned income, you can:

  • Keep your financial records in order
  • Look at your bank statements and bills as soon as they arrive and report any discrepancy or anything suspicious
  • Be vigilant about identity theft
  • Watch out for fraud and scams
  • Regularly check your credit record and credit score
  • Choose insurance to meet your needs

Note: You are entitled to a free copy of your credit report every 12 months from each of the three nationwide credit bureaus. Go to www.AnnualCreditReport.com or call 1-877-322-8228 to order the free reports. Beware of imposter sites. 

Protect your income

As mentioned above, insurance is a key component of this principle. Just like you buy car insurance to protect your car, you can buy income insurance to protect your income.

Income protection insurance – or disability insurance – is designed to cover up to about 60% of your paycheck or income if you become sick or injured and can’t work for some time (and it’s confirmed by a doctor). That way you can continue to budget, save and invest in your future while you get back on your feet.

Income Protection Insurance

Unexpected events happen in life. Cancer and mental health issues are two common reasons for disability insurance, and both of these conditions, as well as others, could pull you away from work for months or even years.

The Spend Principle

The fundamental concept of the Spend Principle is to make a budget or a plan for using your money wisely. This includes setting short and long-term financial goals.

Some tips for budgeting are:

  • Track your spending to improve your finances
  • Create a realistic monthly budget
  • Live within your means
  • Cutback on recurring charges

The Borrow Principle

The Borrow Principle is all about preparing to borrow money for a major purchase and then making sure you repay what you owe. Your ability to get a loan or qualify for a new credit card generally depends on your credit history, and that depends largely on your track record at repaying what you’ve borrowed in the past and paying your bills on time.  So, be careful to keep your credit history strong.

When it comes to borrowing money, make sure to:

  • Track your borrowing habits
  • Pay your bills on time
  • Learn about credit and how to use it effectively
  • Pay attention to your credit history

When you need to borrow money, it’s also important to plan and shop around for a loan with a low Annual Percentage Rate (APR).  

Financial literacy for kids

A licensed vocational nurse (LVN) is a term used in California and Texas, while a licensed practical nurse (LPN) is the term used everywhere else in the United States – for pretty much the same position.
No matter which acronym you use – you don’t need an Associate Degree or a Bachelor of Science in Nursing (BSN) to work as an LPN or LVN. You do, however, have to complete a formal training program and pass a state-administered exam known as The National Council Licensure Examination for Practical Nurses (NCLEX-PN).4

According to Sagevest Wealth Management5, receiving an allowance is probably the first big step in your kids’ financial education. It gives them a taste of financial independence, and more importantly, financial responsibility. And when it comes to borrowing, letting your kids occasionally borrow money from you is a good way to demonstrate the benefits of being debt-free. It is a valuable money management skill and is a lesson better learned at home than with a credit card company.

Healthy financial habits

Protecting your income is a necessary pillar of financial literacy so you can continue to earn, save, and invest in your future without interruption. Disability insurance, also known as income protection insurance, is essential because the entire idea of unplanned injuries and illnesses is just that — unplanned and unexpected.

You can get a fast, commitment-free quote in minutes right here! It’s important to establish healthy financial habits as early as possible, but it is never too late to get started!


  1. https://news.gallup.com/poll/249164/americans-feel-generally-positive-own-finances.aspx?g_source=link_NEWSV9&g_medium=NEWSFEED&g_campaign=item_&g_content=Americans%2520Feel%2520Generally%2520Positive%2520About%2520Their%2520Own%2520Finances
  2. https://www.investopedia.com/terms/f/financial-literacy.asp
  3. US Financial Literacy and Education Commission
  4. https://www.lpn.com/lpn-vs-lvn/
  5. https://www.kidsfinancialeducation.com/getting-started/financial-literacy-building-blocks/