21st Century

Literacies
Financial Literacy
 What is financial literacy in 21st century?

Financial literacy involves the ability to

understand how money works in term of
financing, and how to make positive financial
decisions.
Financial Literacy
• Financial planning/Goal setting and
valuing
• Budgeting, spending and investing
• Savings and banking
• Avoiding Financial Scams
• Insurance and taxes
• Tips on being financially stable
 Financial Planning/
Goal setting and Valuing
Financial planning is the practice of
putting together a plan for your
future, specifically around how you
will manage your finances and
prepare for all of the potential costs
and issues that may arise. The process
involves evaluating your current
financial situation, identifying your
goals and then developing and
implementing relevant
recommendations.
Financial goals are savings,
investment or spending targets you
hope to achieve over a set period of
time. The stage of life you’re in
usually determines what type of
goals you wish to achieve.
 Valuing
refers to the process of
determining the present value of
a company, investment or an
asset. It can be done using a
number of methods. Analysts
who want to place a value on an
asset normally look at the
prospective future earning
potential of that company or
asset.
 Budgeting
the process of calculating how
much money you will earn
during a particular period of
time, and planning how much
you will spend, save, and
borrow: Financial budgeting is
vital if you want to pay your
mortgage off early.
 Spending
A spending plan should include all of
your money coming in, money going
out, and money put towards savings.
True, in addition to regular monthly
payments such as rent and bills, a
spending plan should also include
irregular payments such as family
trips, medical co-pays and deposits
to savings.
 Investing

Financial investing refers to

putting aside a fixed amount
of money and expecting some
kind of gain out of it within a
stipulated time frame.
 Savings
refers to the money that a person
has left over after they subtract out
their consumer spending from their
disposable income over a given time
period. Savings, therefore,
represents a net surplus of funds for
an individual or household after all
expenses and obligations have been
paid.
 Banking
A commercial bank, where most
people do their banking, is a type
of financial institution that accepts
deposits, offers checking account
services, makes business, personal,
and mortgage loans, and offers
basic financial products like
certificates of deposit (CDs) and
savings accounts to individuals and
small businesses
Avoiding Financial Scams
here are seven ways to avoid financial
scams.
1. Review your bank accounts. Check your
credit card and banking statements regularly
to make sure there are no unauthorized
charges. If you do see a payment for
something you don’t recognize, contact your
financial institution immediately and let them
know so that you can dispute the charge.
2. Use strong passwords and change them often. It’s
important to use strong passwords on all of your
online accounts, and it’s good practice to change them
regularly. Be sure not to use the same password for
multiple accounts.
3. Shred sensitive information. Don’t throw away any
sensitive paperwork before shredding it. Dumpster diving is a
common tactic whereby scammers will go through your
garbage to find out information such as account numbers and
passwords, and then use it to access your data or steal your
identity. Always shred bank statements, tax information and
other documents with sensitive information such as account
numbers, social insurance numbers, personal identification
numbers, etc.
4. Use the Internet safely. Try to avoid using public Wi-Fi,
as it’s less secure and can leave you vulnerable to hackers.
If using public computers, such as those at a library, always
log out of any accounts you’ve signed into before leaving.
If you’re shopping online or inputting any kind of sensitive
information, always 
make sure you’re using a secure website and Internet
connection.
5. Check your credit report. Once a year, contact a
credit report agency such as Equifax and TransUnion –
the two major credit reporting agencies in Canada – to
ask for a copy of your credit report. Many agencies
provide a report for free. Review your credit reports
thoroughly and make sure your information is accurate.
If there are any debts that you do not recognize, let them
know you want to dispute it.
6. Double check email addresses and links. Scammers are
becoming savvier at getting people to click on malicious links.
They pose as representatives from the Government or other
companies to get you to trust them, and often use a sense of
urgency to get you to click on a link without fully reading it.
Always read email addresses and links carefully to make sure
they’re legitimate. If you’re unsure, contact the company or
government agency directly to confirm whether or not they sent
you communication. Banks and government agencies typically
don’t text or send unsecure emails, so always be wary of messages
like these.
7. Educate yourself. Ultimately, the best
way to avoid becoming a victim of
financial fraud is to educate yourself on
common scams. New scams are always
popping up, so it’s important to keep
apprised of new tricks that criminals are
using.
 Insurance

Financial insurance is a type of insurance policy

that is frequently purchased by businesses. It
provides coverage that protects them from losses
due to a partner in a contract failing to meet their
obligations. It can also protect against various
other types of commercial financial losses.
 Taxes

Income tax is a direct tax that a government levies

on the income of its citizens. The Income Tax Act,
1961, mandates that the central government
collect this tax. The government can change the
income slabs and tax rates every year in its Union
Budget. 
Income does not only mean money earned in the
form of salary. It also includes income from house
property, profits from business, gains from profession
(such as bonus), capital gains income, and 'income
from other sources'. The government also often
provides certain leeway such that various deductions
are made from an individual's income before the tax
to be levied is calculated. 
Tips on being Financially Stable
Here are six habits you can start now so you
can protect and build your wealth:
1. STOP TELLING THESE TO YOURSELF, “I NEED TO BUY
THIS. I DESERVE THIS.”
You don’t need to try out all the food trucks near the office, to rush to
the mall for the big sale, and to travel during holidays. These are a
few of the biggest mistakes when it comes to financial planning.
Don’t be pressured to go shopping and to travel just to post
something interesting on social media. Think of it this way: The
amount of money you have now may only take you to Baguio, but if
you stop spending and start on financial planning, your future money
may take you to a colder and grander place like Japan or Korea.
2. PRIORITIZE YOUR BILLS EVERY PAY
DAY.
Get the bills out of the way before spending your
money. This way, you don’t end up with more
money for shopping but less money for monthly
dues. Making the bills your top priority is a great
step to financial literacy.
3. SAVE AS MUCH AS YOU CAN EVERY MONTH.
Learn how to save money and how to start early. According
to CNBC, the goal in your 20s is to set aside 25% of your
overall gross pay. If you think you don’t need to spend too
much on other things, increase your savings up to 26% to
30%. Practice this: when you receive your salary, before
spending on anything, set aside your target amount for 
savings plan. More savings = more protection for the future.
4. INVEST, INVEST, INVEST.
There’s no such thing as “too early to invest”. There’s no such thing
as “too young to think about retirement”. In growing your money,
time is your ally so the earlier you start, the better. Also, it’s not just
about learning how to save your money, it’s about learning how to
protect it, too. Start being a budget planner by mapping out ways
on how you can invest by working with your monthly income. This 
insurance and investment plan is a great way to learn how to value
money and to level up your financial literacy. Talk to an expert to
help you start your financial plan.
5. MANAGE CREDIT CARD DEBT.
As much as possible, avoid excessive use of your credit
card. Installment kind of payment process may be helpful,
but make sure you have an effective plan on how to pay
your monthly dues. Pro tip: Always pay more than the
minimum monthly required payment. Successful money
managers even pay in full. Be a master budget planner so
you can live freely and happily within your means.
6. PROTECT THE ONES YOU LOVE WITH YOUR
INVESTMENT.
Building your wealth is not just about protecting your financial
needs, it’s also about protecting the needs of your loved ones. Free
yourself from worry and doubt by investing in a life insurance that
provides financial protection for you and your loved ones no matter
what happens. Get a family insurance that allows you to customize
the kind of protection for you and your family, from unexpected
mishaps to health issues to medical bills. There’s nothing more
rewarding than building your wealth for you and your family.