Why You Should Grow Your Financial Literacy

Money can be an essential tool to help you get the things in life that matter most to you.

3 min read

Money isn’t everything, but it can be an essential tool to help you get the things in life that matter most to you, whether it’s a home for your family, nights out with friends, or pursuing your dream career. But if you don’t know how to manage it, money can become a big source of stress, and an obstacle that stands in the way of getting what you want in life.

Just remember it’s your money, and you’re in control. It might not feel like it sometimes, especially if you aren’t too comfortable staying on top of your finances, but there’s ways to learn. At N26, we’re dedicated to helping you learn more about money management so you can get your financial wellbeing to the next level.

What is financial literacy?

Financial literacy is the ability to manage your money more effectively. It’s a set of skills that allows you to make smart financial decisions, including:

  • How to budget your income and expenses

  • How to prioritize saving

  • How to use credit responsibly and manage debt

  • How to keep your financial information safe

If you didn’t learn any of this in school, you’re not alone. Many people have never been taught about financial literacy, but everyone can learn — and the sooner, the better.

Why is it important to learn financial basics?

If you use money, then learning financial basics is essential. When you know how to manage your finances, you’ll be better equipped to afford what you truly want, and you’ll be able to avoid common traps that make reaching your financial goals more difficult. By having a basic understanding of how money works, you’ll be empowered to pursue your goals and create the future that you envision for yourself.

Where am I on my financial journey?

Ask yourself the following questions to understand where you are when it comes to managing your money.

How do you deal with debt?

  • Beginner: I pay down my debt when I can, but I need to follow a better budget so I can cover my credit card payments for the upcoming months (and stress less about them).

  • Intermediate: I track my expenses the best I can and focus on paying down my high-interest rate cards first. But I worry that I’m not doing enough.

  • Advanced: I monitor and budget my expenses, which helps me plan for any monthly debt payments and avoid unnecessary interest and fees. I’m debt-free or feel confident about getting out of debt.

Are you saving for the future?

  • Beginner: I live paycheck to paycheck.

  • Intermediate: I’ve started to build an emergency fund, but I’m not saving much for the future besides that.

  • Advanced: I have an emergency fund and am also saving for the future.

How do you budget your expenses?

  • Beginner: I live a bit above my means and sometimes spend more that I can’t afford on things that I want in the moment.

  • Intermediate: I’m pretty good at budgeting to stay within my means, but I’m not saving as much as I’d like to.

  • Advanced: I try to limit my spending to 50% needs, 30% wants, and 20% savings — and I usually do.

How can N26 help me make smart financial decisions?

No matter what your level of financial literacy is right now, you can learn the skills that you need to manage your money. Our accounts are designed to help you make good financial decisions, and give you a clear understanding of your money. Stay in control of your budget with N26’s automatic spending statistics, a simple visual breakdown that shows you exactly where your money is going every month, or use N26 Spaces to put money aside for the things that matter most to you.

 Are you ready to take your financial literacy to the next level? Sign up for an N26 account today, and get mobile banking that supports you in your financial journey. 

The N26 account is offered by Axos Bank®, Member FDIC. N26 Inc. is a service provider of Axos Bank. All deposit accounts of the same ownership and/or vesting held at Axos Bank are combined and insured under the same FDIC Certificate 35546. All deposit accounts through Axos Bank brands are not separately insured by the FDIC from other deposit accounts held with the same ownership and/or vesting at Axos Bank. The N26 Visa® Debit Card is issued by Axos Bank pursuant to a license by Visa U.S.A. Inc. The N26 Visa Debit Card may be used everywhere Visa debit cards are accepted.

Related posts

Maybe some of these will interest you