National Financial Literacy Month: The financial literacy toolkit

toolkit

It's critical to have a financial literacy toolkit when planning your finances.

You need first to learn the basic skills like setting smart financial goals. But once you have that ground work, you move onto budgeting, bank accounts, credit, credit cards, investing, insurance and estate planning. That's where a financial literacy toolkit comes in — and we have it all for you here in this article.

April is National Financial Literacy Month in the U.S. As I do every April, I'll spend much of the next few weeks reviewing basic financial concepts. But unlike past years, I'm not going to devote every post in April to this subject. It's important, yes, but spending an entire month on the basics gets tedious.

Here's a list of financial literacy resources to help you add to your financial literacy toolkit.

Get Rich Slowly

This site regularly features articles about basic personal finance skills. Some of the best from the past five years include information on the following topics:

Basic skills

Budgeting

Bank accounts

Credit and credit cards

Investing

Insurance and Estate Planning

As a general rule, the basics category here at Get Rich Slowly contains information about fundamental financial literacy.

But there's more to financial literacy than just learning the nuts and bolts. There's a lot of mental and philosophical stuff that can help you take control of your finances. To learn more about these aspects of money management, browse through the fourteen tenets of my financial philosophy:

Saving and Investing

In April 2007, I shared a series of videos from author Michael Fischer. Though designed as companions to his book, Saving and Investing, these short pieces stand on their own. Look past the fact that these aren't polished and professional — Michael provides some excellent information. Here are links to each part in the series:

  1. Introduction
  2. The power of compounding
  3. Providers and users of capital
  4. The difference between debt and equity
  5. What is leverage?
  6. An introduction to financial statements
  7. Why do financial markets exist?
  8. What is a bond?
  9. What is a stock?
  10. What is a stock market index?
  11. The importance of diversification (also an introduction to diversification)
  12. What is a mutual fund?
  13. Types of mutual funds
  14. The difference between active and passive management
  15. An introduction to dollar-cost averaging
  16. The impact of time
  17. The three enemies of growth
  18. Coping with high-interest debt
  19. Getting started
  20. 5 popular misconceptions about money

Other Web Sites

There are other excellent financial literacy resources around the web.

  • CNNMoney has an outstanding overview of basic personal finance topics called Money 101. Each of the 23 topics includes several pages of information, and many of the subjects include an interactive calculator or tool.
  • The Federal government has a website called MyMoney.gov, which is “dedicated to teaching all Americans the basics about financial education.”
  • The Federal government also provides the Federal Citizen Information Center, which offers free (or cheap) publications on a variety of topics including personal finance. Many of these publications are available in free PDF versions.
  • Both Illinois and Wisconsin have sites devoted to personal finance education. These two pages contain a wealth of links to information on many subjects.
  • 360 Degrees of Financial Literacy is a site from the American institute of CPAs. It includes many articles on various life stages such as “college,” “couples & marriage,” “home ownership,” etc. A clunky interface, but a lot of solid information.
  • Ramit at I Will Teach You to Be Rich has The world's easiest guide to understanding retirement accounts.
  • Rhetorical Device offers A brief history of money. This is actual history. It's a short article, but fascinating.

Between the Saving and Investing video series, the GRS basics archive, and the other sites I've linked here, you have a wealth of personal finance material at your disposal. I look forward to writing more about financial literacy in the years ahead.

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plonkee
plonkee
13 years ago

Well, I know that I need to learn about asset allocation. I’m not sure if thats what you’re envisaging in your financial literacy month though.

Wesley
Wesley
13 years ago

This will be a great review, and I’m looking forward to it!

MyOwnMillions
MyOwnMillions
13 years ago

I think this is a great idea that you are trying to educate all of us on this subject. Blogs like ours are always trying our best to write articles to help the public understand this complicated, boring but important subject. Take me for instance, I started my blog since it seemed like it was a fun thing to do but as I got more into it, I developed a sense of mission to try to help the general public learn how to increase wealth. There are a million ways to do this and most people probably don’t know how… Read more »

limeade
limeade
13 years ago

I’m a huge fan of the subject. I love to learn and help others out with what I know. I’ve written about some of the basics here.

I look forward to hearing what you have to say. We may not all agree, but that’s what makes it interesting.

-limeade
http://fiscalmusings.blogspot.com

Terry
Terry
13 years ago

Budgeting. That’s what I need to learn better. I know my problem better than I know the solution. I overthink everything and want to get into such intricate detail that I never get around to the basics. I’m too busy trying (and failing) to track every penny I spend that I never get to the part where I examine my expenses, write a reasonable budget, and follow it.

My salary has increased 43% in the last 3 years, and I still have the same amount of money saved. That’s ridiculous.

MyOwnMillions
MyOwnMillions
13 years ago

Terry, you might want to start by looking into what you’ve spend more than 3 years ago. If you are just buying more items, the “cure” is different than if you were buying the same number but more expensive versions of them (ie different car, TV etc). Just remember that knowing is the first step in the fix and don’t give yourself excuses like “I’m too busy” since it doesn’t take more than 5 minutes a day to keep track of the expenses once you have the spreadsheet setup. You are welcome to contact me if you think discussing with… Read more »

munny-bunny
munny-bunny
13 years ago

I need help understanding the stock market!

I am a 20-something who in the past couple of years is finnaly getting her personal finances under control. I have a budget we stick to, we have successfully been contributing to our savings regularly, and we both contribute to our retirement funds.

I feel like the next step is investing some of our savings in the stock market, or bonds, or whatever. But I have no clue where to start. I need a beginner’s crash course, and some advice on where to go to find out more in-depth.

Thanks!

Martez
Martez
13 years ago

Saving money has always been an issue for me, and I also don’t have very much financial literacy- I’m looking forward to this month!

--matthew
--matthew
13 years ago

I’d like to know more about how stocks actually work. I understand that they do work, but when I tried to convince my girlfriend to start investing, she was scared by the “magic” of interest. I had no way to actually explain to her how investing actually makes her money, and why it’s not something crazy that will devour her savings.

MossySF
MossySF
13 years ago

Stocks is pretty simple. When you buy stock, you buy ownership of a company. It’s no different than buying the local coffee shop from the previous owner and taking the profits as your income. The only difference is that you and millions of other people collectively own the company. Your share of the company increases in value as the company’s economic output increases — and the company’s increase is usually tied in some fashion to the country’s/world’s increase in economic activity. Why economic activity increases — well that’s a whole subject in itself. Suffice it to say, economic output has… Read more »

Msminiducky
Msminiducky
13 years ago

I’ve discovered that I don’t know how bonds work, exactly. Roth IRA fund bonds, to be exact. I received my first quarter’s statement and am baffled by the Income Dividends versus the Long Term cap gains.

JL
JL
13 years ago

If you want an excellent foundation for understanding money and other monetary terminology,

I strongly suggest you check out principiapub.com and consider ordering the book MONEY.

Why? Because you will receive “inside” information that most don’t know about, or choose to be ignorant of (including bankers & lawyers)

Reading this book may also help you to build and/or preserve wealth.

I receive no money from recommending this book or from you ordering this book. I simply wish I would have known about this information earlier in my life, and I want to share it with others.

Happy reading.

Christian
Christian
13 years ago

I have one suggestion. It would be nice if you had links to all the articles from this series, at the bottom of this post. It will help as a quick reference so visitors dont have to dig through the archive. I apologize if you already have a list of all the posts in this series, I have looked and it has not been obvious.

Thanks for all the hard work on these posts!

sandycheeks
sandycheeks
13 years ago

This is a great summary and links resource post. It’s a post like this that brought me to GRS. Like you suggested, I’ll be bookmarking it so I can review the links later.

Alison.com
Alison.com
13 years ago

ALISON provides via the Internet, highly interactive self-paced multimedia training
courseware for BASIC SKILLS to the individual learner for FREE.

Financial Literacy is only one course, which contains Seven modules of interactive multimedia learning are provided on personal financial management. The course provides information such as how to set up a bank account, planning for the purchase of a home, to the basics of preparing financially for retirement. For someone struggling to manage their finances or simply wanting to learn more about how to make the most of their money, this course is for them.

Just take a look: http://alison.com/courses/IFLC

MillionDollarJourney.com
MillionDollarJourney.com
13 years ago

Another great post J.D. It’s no wonder you have a huge fan base.

FT

tinyhands
tinyhands
13 years ago

All in all, a successful theme-month I would say.

Ranjan
Ranjan
13 years ago

Vow! Such a treasure trove. Even though it’s US specific, it’s useful to learn the concepts for an Indian like me.

pf101
pf101
13 years ago

Excellent list. I’ll be adding several to my resources page.

english major
english major
12 years ago

for those of us nitpickers:
“on they’re own” is killing me… please fix!

Rick
Rick
12 years ago

thanks for putting all this helpful info in one post, you should make an easy link to this for future reference! 🙂

Mrs.ThePoint
Mrs.ThePoint
12 years ago

wow…this post is great.
It answered sooooo many financial questions that I had before.
Thank you so much.
I am still not an expert (will never be) but I think I am finally starting understand my retirement account now.(sorry to sounds so silly)

J.D.
J.D.
12 years ago

How on earth did I let “on they’re own” through? How did I even write it? I’m so embarrassed. I should hang up the guns… 🙁

Shirley
Shirley
12 years ago

J.D.-Sometimes the brain just doesn’t cooperate, I find myself rereading even the most basic emails to friends for just these types of mistakes. I think it happens when we have are juggling too many balls in the air at once.

Nice compendium post–thanks. 🙂

The Weakonomist
The Weakonomist
12 years ago

Without knowing of financial literacy month, I contacted my state’s education board for an interview with weakonomics.com with THEIR team for financial literacy. Coincidence, maybe. Perfect timing, totally.

JD, have you done any interviews for the blog? Its a great way to bring in people that don’t normally read them.

Braun Mincher
Braun Mincher
12 years ago

Anybody who wants to test their own knowledge of Financial Literacy is welcome to take my free 50-question multiple choice financial literacy quiz:

http://www.FinancialLiteracyQuiz.com

We also just released a press release with the 1st quarter quiz statistics in case you are interested in seeing how you compare against your peers (check out the “Press & Media” Page:

http://www.BraunMincher.com

Enjoy!

Braun Mincher, Author
The Secrets of Money: A Guide for Everyone on Practical Financial Literacy

Baker @ ManVsDebt
Baker @ ManVsDebt
11 years ago

Wow, I don’t have 7 hours to go through all this content again right now… Maybe tonight! Thanks for the incredible resource.

Jeff
Jeff
11 years ago

Wonderful! Bookmarked.

Chickybeth
Chickybeth
11 years ago

The videos for #20 are no longer available on YouTube. Is there another link to them?

Roger
Roger
11 years ago

Wow, an amazing compendium of financial literacy. I like to believe I’ve become fairly financially suave, but I’m sure I’ll find some things in this collection that I haven’t already learned.

Mario
Mario
11 years ago

Holy cow. *Speechless*

Can I just give you money?

Charlotte
Charlotte
11 years ago

Speaking of financial literacy, check this out:

http://www.mymoney.gov/

Aman@BullsBattleBears
11 years ago

A great set of links to read during the weekend! thank you.

Valerie@CookingSharp
11 years ago

Thank you, this is a great group of links! It’ll take me days to read it all…

Jessica the hedgehog
Jessica the hedgehog
11 years ago

As a new reader of your website, this is a perfect way for me to catch up! I’m particularly looking forward to checking out the investment sections. Thanks so much! 🙂

Mike
Mike
11 years ago

Every time I see a government website, or brochure, on “how to manage your money” I equally giggle with delight and die a little inside.

Why would ANYONE take advice from the government on how to manage money????

From running such a huge deficit, bailouts, etc, they are simply the farthest thing from a credible and responsible resource.

/facepalm

TStrump
TStrump
11 years ago

Wow – this is the mother-of-all list of links.
Thanks!

Deb
Deb
11 years ago

JD, I’m late in posting this, but I want to make a seriously huge announcement here:

“THANK YOU THANK YOU THANK YOU”

I cannot believe how educational your blog has been, how helpful it has been, and how informative it is. I’m not very financially savvy, but thanks to YOUR hard work, I have definitely moved up on the financial learning curve.

I have saved dozens of your posts, noted dozens of books to add to my read list, and have been able to make better decisions, all because of YOUR hard work.

I absolutely cannot thank you enough.

Rosa
Rosa
10 years ago

Thank you for doing this! I know you get bored with the basics but we all have gaps in our financial educations.

Since one of your basic tenets is “money is more about the mind” maybe a few articles about finding balance (and frugal friends, negotiating with relatives, etc.) would be an interesting new thing on that list.

Mike
Mike
10 years ago

Thanks J.D.

Bookmarked!

Qazzi
Qazzi
10 years ago

For investing the http://www.bogleheads.org, in honor of Vanguard founder Jack Bogle, is a great site with an excellent forum.

Ely
Ely
10 years ago

JD, I’m going back and reading through your 14 Tenets again. You are so my hero. Your posts are so thoughtful, well researched, and intelligent; your voice is so personal, like we were having a conversation in my living room. You inspire me to look newly at what is really important to me, and to align my (financial) life with that.

Thanks again for all that you do.

Adrian
Adrian
10 years ago

J.D., I believe you under-estimate yourself; being such a modest individual you simply cannot fathom how much of a truly wonderful resource you have become to those of us whom pined to gain a sound financial education. This attainment of knowledge is key to a sustainable financial life yet is rarely mentioned in much more common media outlets as well as educational environments. Thank You again on behalf of all of us for the incaculable amount of hard work and effort you have put in all of these past years – You may only be one individual, but your words… Read more »

David/Yourfinances101
David/Yourfinances101
10 years ago

I think this financial literacy month should be every month.

Taing a good hard look at my finances, and fixing them, have changed my life in ways I cannot even begin to count.

Aicha
Aicha
10 years ago

J.D. I’ve started reading your blog early last year and I am so glad I subscribe to your blog post. I’m only 23 years old and I feel like I am a bit wiser than my friends when it comes to generally taking care of my money. I have started working for 2 years now and I am proud to say that because of your words and financial wisdom, I have avoided living paycheck to paycheck because I have what you have taught me “emergency funds”, “leisure funds”, “travel fund” saved bit by bit! Thank you J.D.! It’s a tough… Read more »

DreamChaser57
DreamChaser57
10 years ago

Phenomenal post and resources, thanks for all the effort! I’ve definitely bookmarked this and can’t wait to dig in later. As far as ideas for posts, I would absolutely love a post on concrete ways to lower your entertainment and take-out expenses; these are my household’s constant budget-busters. I thought I would chime in with a take-away I got from GRS (this could also be another post) – one of the HUGE ones is the Targeted Savings Account (ING in my case). It feels grand not to have to take our semi-annual auto insurance premium out of one check.

noelle
noelle
10 years ago

This is such a wonderful resource, I’ve read probably most of your articles, but I most certainly need another good financial kick in the butt, so I might delve through them again. On the April Fool’s post regarding money mistakes, I noticed a few others as well as myself mentioning student loans as an issue. Education is a pretty big investment, one I think too many of us go into not fully aware of the risk we’re taking. I know I certainly did. JD, do you have any knowledge on the subject that could maybe lead to a literacy month… Read more »

Joel
Joel
10 years ago

Glad you’re celebrating National Literacy Month once again! Oregon Governor Ted Kulongoski also declared it Financial Literacy Month in Oregon. We’re celebrating with some fun activities as well at http://www.orcpa.org/financial_literacy.

Cheers!

E
E
9 years ago

I’d like to learn more about Roth IRA because I’m thinking to open one. I started reading this blog not too long ago, so I don’t know if you ever devoted a blog entry to this topic, but I think it’s a good one. I’m finishing up grad school next year and don’t have a lot of money saved yet, but I believe this might be a good place for me to invest.

El Nerdo
El Nerdo
9 years ago

Hey JD, April is also National Poetry Month, so you could give lessons in Neoclassical verse. Or open up a contest. As for the subjects, I would suggest the following: -Investing 101 -How to Buy Into your a Mutual Fund (could also be “your first Mutual Fund”) -The Art of the Possible (Homage to Max Weber’s “Politics As a Vocation”) – How to negotiate your wild dreams with a limited reality (it’s not by financing them at 24%). [this might be a bit repetitive, but hey, say it in heroic couplets and it’s a whole new game] – April in… Read more »

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