CONTENT

Financial Literacy
What is financial literacy?
- Financial literacy is the ability to understand and effectively use various financial skills, including
personal financial management, budgeting, and investing.
- Financial literacy is the foundation of your relationship with money, and it is a lifelong journey of
learning. The earlier you start, the better off you will be because education is the key to success
when it comes to money.
Characteristics of a financial literate Individual
Financially literate people:
 Set goals and make plans to achieve these goals.
 Set aside savings for emergecies.
 Keep their financial obligations under control and do not borrow money if they are unable to
repay it.
 Monitor their spending patterns.
 Understand concepts such as loans, credit cards, and debt.
 Are aware of the services banks provide.
 Are knowledgeable about investment options.
 Do not spend more than they earn.
 Set aside part of their income on a regular basis.
 Make plans for the future.
 Have a good understanding of tax-related issues.
 Use their credit cards in a way that allows them to afford the monthly payments, if any.
 Ask the right questions. (‘What is the value of this purchase for me?’, ‘Is this really a need or a
want?’)
 Ask to be informed sufficiently when they spend money.
 Do sufficient research before shopping.
 Are aware of the reasons behind their decisions.
 Do the necessary research before making investments.
BUDGETING
- Budgeting is creating a plan to spend your money.
One of the first building blocks of a successful personal finance plan is the ability to budget.
Steps to do in budgeting
1. Start tracking your monthly expenses.
2. Identify fixed and variable expenses.
3. Add up the totals.
4. Study your variable expenses.
5. Factor in savings.
6. Now set your budget
Spending
- Needs
- Wants
Investing
Benefits of investing
1- You Stay Ahead of Inflation
2 – Investing Will Help You Build Wealth
3-Invest to Meet Other Financial Goals

SAVINGS AND BANKING

Saving tips:
 DO set up a portion of your paycheck to automatically go to savings.
 DON’T leave a savings account as your last financial priority.
Banking
Benefits
 Bank accounts offer convenience
 Bank accounts are safe
 It's an easy way to save money
 Bank accounts are cheaper
 Bank accounts can help you access credit

HOW TO AVOID FINANCIAL SCAMS AND DEBTS

 Review your bank accounts

 Use strong passwords and change them often
 Shred sensitive information •Use the Internet safely
 Check your credit report
 Double check email addresses and links
 ducate yourself

INSURANCE AND TAXES

What is insurance?

Insurance is a contract (policy) in which an insurer indemnifies another against losses from specific
contingencies or perils.

There are many different types of insurance.

1. Health Insurance
 2. Home Insurance
3. Auto Insurance
4. Life Insurance

The core components that make up most insurance policies are the deductible, policy limit, and
premium.

What is tax?
 Taxes are mandatory contributions collected by governments.
 The Internal Revenue Service (IRS) collects federal income taxes in the United States.
 There are many forms of taxes and most are applied as a percentage of a monetary exchange
(for example, when income is earned or a sales transaction is completed).
 Other forms of taxes, such as property taxes, are applied based on the assessed value of a held
asset.
 Understanding what triggers, a tax situation can enable taxpayers to manage their finances to
minimize the impact of taxes.

TIPS ON BEING FINANCIALLY STABLE

 Make savings automagical.
 Control your impulse spending
 Evaluate your expenses, and live frugally
 Invest in your future
 Keep your family secure
 Eliminate and avoid debt
 Use the envelope system
 Pay bills immediately, or automagically
 Read about personal finances
 Look to grow your net worth

Deped order 022, s 2019 Financial Education Literacy

PEDAGOGY
- Free financial counceling
- Split money into category