13 Apr Financial Literacy Month
April is Financial Literacy Month. At NBIC, we believe financial literacy is one of the biggest obstacles that prevent clients from achieving business success.
To celebrate Financial Literacy Month, we’re going to share a series of posts about financial literacy. We’re going to focus on these four topics:
- Myths about financial literacy
- Budgeting for yourself and your business
- Saving for big goals
- And getting ready for retirement (yes, right now!)
We hope these posts have information that can help you rethink your business’s finances. The goal isn’t to explain everything you need to know about financial literacy, but instead introduce the main ideas that can be further explored.
The first topic we’re going to cover are some myths about financial literacy.
Myths and Facts About Financial Literacy
There are a few articles that touch on myths about financial literacy. Forbes has a list they created last year plus this list to improve your financial literacy as a business owner; and BlueVine has a list of 5 financial literacy skills for small business owners.
Some of our favorite tips from these lists are:
- Myth: A Retirement Plan Before 40 is Too Early (Forbes)—saving for retirement can begin regardless of how far away you are from retirement. Knowing your objective will inform how much income you need to make for your business, and drive other business-related decisions.
- Myth: Risk is Risky, It’s Only Savings (Forbes)—working on something you don’t know anything about is scary, which is why educating yourself is crucial. Ask a financial advisor to help you with the process, in addition to diving into a few books or following experts with blogs and podcasts.
- Understand financial statements (BlueVine)—financial statements are the health scorecards of your business. A cash flow statement, for example, helps you understand where money is being spent and help determine whether you can pay employees and the bills of your business.
- Bookkeeping (BlueVine)—even if your business has few transactions, monthly bookkeeping gives you a sense of your business’s financial obligations. Bookkeeping is also crucial for tax purposes, not only to pay any taxes that are owed, but to have an accurate sense of deductions for your business.
What are some of the questions you have about financial literacy? Let us know on social media!