As gas and food prices continue to climb, it is critical that we effectively manage our budgets and personal finances to make ends meet. Juggling investments, tax returns and credit card bills can be difficult, so it is important to educate yourself on the best ways to save and invest in your future. Since April is Financial Literacy Month, I wanted to share with you some tools that will help you better understand your finances and protect yourself against identity theft.
In 2003, Congress passed a law that entitled everyone to a free credit report every year from each of the three top credit reporting agencies: Experian, TransUnion and Equifax. Credit reports detail your outstanding debt, available credit and payment history; these and other factors determine your credit score. Your credit score is used by lenders and credit card companies to determine your interest rates. The higher your credit score, the more likely you will be to get a better interest rate on a credit card or home loan. For more information on how to obtain your credit report, visit www.annualcreditreport.com, call (877) 322-8228 or write to the Annual Credit Report Request Service at P.0. Box 105281, Atlanta, GA 30348-5281. If you review your credit report and believe something is inaccurate, you should dispute it with the credit reporting agencies.
Parents play an important role in their children’s understanding of money management. A recent study by Visa indicates that less than half of people learned about money management from their parents. Only five percent of adults received any sort of financial education in elementary or high school (Visa Back-To-School Survey, August 2007). Financial literacy should start at home. It is important to teach your child about budgeting and managing finances so they will not have to learn financial lessons the hard way.
One organization in particular has recognized the importance of teaching children about finances. The Jump Start Coalition is a national coalition of organizations dedicated to improving the financial literacy of children of all ages. The Jump Start Web site offers resources for parents and teachers who are interested in educating children about money management. You can find information about free local educational events and activities on the Kentucky Jump Start website (www.kyjumpstart.org) or by contacting the office at (502) 573-3390, extension 252.
Another excellent resource for learning about finances is available online at www.mymoney.gov. Through this website, you can browse important financial tips from more than twenty federal agencies. The website offers a variety of calculator programs which can help you determine the best college savings plan, learn about investing and teach you about your individual Social Security benefits. You can also find detailed information about how to protect yourself as a consumer on the “Privacy, Scams and Frauds” section of the website.
As a father and a former small business owner, I know how important it is to actively manage your finances and to teach your children responsible habits. Whether you are investing for retirement, saving to purchase a new home or repaying student loans, taking the time to educate yourself and your children will pay off in the long run.