High school is a great time to learn about the fundamentals in life. Here are some personal finance basics you wish they taught in school.
Are you learning about personal finance basics? Start here first.
In the United States, households have an average of more than $8,000 of credit card debt alone. With so many Americans suffering from debt, it’s a crucial time to know how to personal finance.
For those looking for the best, here are the personal finance basics you wish they taught you in school.
Read on to learn more.
1. Know How Interest Rates and Credit Cards Work
When learning finance, it’s very important to know how interest rates and credit cards work. The first step in understanding finance is to understand that credit cards accrue daily.
Know you have to pay back every dollar you charge on your credit card. Not paying back your credit card balance in its entirety each month can cause a massive interest rate to occur.
Never use credit to purchase things you can’t afford. Try to save up and only spend the money you have. Build your financial base early to secure a strong credit score in the future.
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2. Learn How to Balance a Checkbook
All personal finance courses will tell you to learn how to balance a checkbook. It’s the best way to understand overdraft fees and cash in-flow and outflow. Additionally, some situations will still require you to know how to write and balance a check.
3. Think About Budgeting
One of the best personal finance topics is budgeting basics. It’s important to be able to differentiate from “needs” and “wants”. Be sure to plan ahead and create a savings plan. Remember costs such as:
Don’t forget it’s just as important to plan for vacation as it is for rent, insurance, and utilities!
4. Don’t Forget About Compound Interest
Over time your money will accumulate and form a compound interest. If you start investing early, you’ll have more time to reach your highest income possible. Try to put small amounts of money into a higher-interest account.
The perfect time to start is while you’re in high school and college. The earlier the better!
5. Consider Building Credit
It’s crucial to build credit in order to manage your finances well into adulthood. Good credit helps you to qualify for housing and even makes it easier to purchase a house. Try to use secured credit cards that need a cash deposit to open.
These secured credit cards will track all your financial movements and report them to highly esteemed credit agencies. Try to use your debit card when possible!
Personal Finance Basics
High school is a great time to learn about the financial fundamentals of life. Know the personal finance basics you wish they taught in school to set yourself up for success in adulthood.
What are you waiting for? Your personal finances await!
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