Why Financial Capability Matters in 2014

Last year, the White House declared April Financial Capability Month, proclaiming that “all Americans deserve the chance to turn their hard work into a decent living for their families and a bright future for their children. Seizing that opportunity takes more than drive and initiative -- it also requires smart financial planning. During National Financial Capability Month, we recommit to empowering individuals and families with the knowledge and tools they need to get ahead in today's economy.”

With the unemployment rate in South Carolina steadily decreasing from 8.1 percent in February 2013 to 6.4 percent as of February 2014, it’s crucial that those gaining employment use practical money management skills. That’s where financial education comes in. Financial education is a means to help alleviate and prevent poverty. Although the unemployment rate is down in South Carolina, the number of those in poverty is up. Currently 1 in 5 South Carolinians live in poverty compared to 1 in 6 in 2000. That’s nearly 300,000 more residents.

Image via Pearson Foundation

Regardless of your economy or your household income, it’s important to realize that financial education matters. Those individuals who receive it are more likely to make the right financial decisions for themselves and their families that will help them build and maintain assets. When people are buying houses, maintaining a home or steady residence, and are paying on their debts, it positively affects the local economy.

Financial education is more than just gaining a budgeting tip here and a saving strategy there. This knowledge converts into skills, which convert attitudes, and those attitudes affect behavior. What you’re left with is healthy financial habits. Those that take charge of their personal finance and choose to become informed consumers avoid scams, predatory lending and other deceptive practices, and can effectively address their needs versus wants.

Family Services, Inc. (FSI), as a charter member of NeighborWorks America, aligns itself with the initiative to help end poverty and raise better awareness for financial education. Their staff of licensed professionals is dedicated to highlighting the importance of financial capability and helping those in the community establish and maintain healthy financial habits. Through its programs and services, FSI advocates, counsels, and educates for clients so they can make the most of what they have.

Written by: Sarah Cornwall, Marketing Resources, at Family Services, Inc.

Make a New Year’s resolution to rid stress from your life…

It’s simple, get your finances in order--you won’t believe how good it feels to be money smart.

Tips for making the list:

BE POSITIVE.

Sometimes this is easier said than done. To keep in the mindset, try wording your goals positively, such as “we’re going to spend money only on things we truly value.” If you stray from your goals, don’t beat yourself up or dwell on your mistakes. It will only serve to make you feel worse and keep off track. Just jump right back on that horse and promise yourself to stay on the path.

Keep your resolutions attainable.

Check in with your goals at least once a month. Set a reminder for yourself. For instance, decide that every time you make a payment on that credit card bill, you’ll revisit your financial resolutions; this will help you track how far you’ve come. Remember that if you’ve made it this far, you can reach your goal!

Be specific.

Make instructions for yourself for just how exactly you plan to attain your goals. Instead of saying you will save more, write a budget up. This will help keep you on point.

Make a contract with yourself.

With your resolutions set, document all your goals. You could even include reasons for committing to them. At www.FutureMe.org, email this to your future self a month, two months, six or 12 months in advance, or print out the letter and place it on the fridge, so you can be reminded of why these goals are important, especially when other crises seem to get in the way.

What our in-house experts recommend you put on the list:

Review your insurance.

Your policies may be outdated and not suited for your current needs. Review what you have: homeowners, life, even auto may be insufficient relative to your present financial situation.

Check your credit score.

Be aware of where your credit stands and take steps to repair any negative aspects. You get three free credit reports each year, there is no excuse for not reviewing what is one of your most important financial reports, especially since errors in these reports are not uncommon. www.annualcreditreport.com

Invest what you can.

Even if it’s just a little, invest in yourself and family. It could be as simple as paying yourself first by contributing to your savings each month, or it could be a retirement fund, an education fund, or making extra mortgage payments. Consider these things as investing in yourself and your future.

Taking care of these will allow you to enjoy a happier, more prosperous and stress-free new year.

Written by: Sarah Cornwall, Marketing Resources, at Family Services, Inc.