Understanding financial concepts like insurance and real estate, and skills like budgeting and investing, is the first step in effectively planning for your future.
Even though mastering these skills can be tough, don’t be discouraged if you don’t gain them right away. Read on to learn what areas comprise financial literacy and take one step closer to improving your financial future.
Below is a list of key financial literacy terms to understand when learning to save:
A budget is an estimate of expenses, income and resources over a given period of time. Budgeting is key to mapping out your future financing and improving your financial literacy, but 56% of American households don’t even have a budget.
Knowing how much money you have and how much you spend is vital to accurately prepare for future expenses. You can start a budget by filling out your own spreadsheet or downloading a budgeting app, such as Wally or Mint.
Debit cards are cards that pull directly from your checking or savings account, eliminating the need for cash or monthly payments. The use of these cards generally has no effect on your credit score.
Credit cards allow you to borrow money from a bank for a purchase and make payments for your purchases at the end of each month. If you use a credit card strategically and responsibly, you can build your credit score and secure a loan for a house, car or other major purchase.
For loans, interest refers to the money that is accrued during the time you borrow money and the time you pay it back. Utilize an interest rate calculator to determine the interest rate that you will owe by the time the money is paid back or receive.
For deposit accounts, interest refers to the amount of money the bank pays you on your deposit.
Insurance is a great way to protect your assets in the event of a car accident, house fire, illness or other unexpected incident. Your insurance contract covers the cost of an incident and allows you to simply pay a monthly or yearly premium.
In addition to these financial tools, there are many ways to improve your financial literacy and save your money. You can open a certificate of deposit (CD), a money market account, a savings account or a checking account.
At Synchrony Bank, we offer a variety of savings products such as an Individual Retirement Account (IRA), High Yield Savings Account and Money Market Account (MMA).
Synchrony Bank does not provide tax advice, so be sure to contact your tax advisor or financial consultant before opening or contributing to an IRA.
Call Synchrony Bank today at 844-345-5789 to talk to a banking representative about opening a savings account today.
*ANNUAL PERCENTAGE YIELD (APY): All APYs are accurate as of .
APYs are subject to change at any time without notice. Offers apply to personal accounts only. Fees may reduce earnings. For Money Market and High Yield Savings Accounts, the rate may change after the account is opened. For CDs, a minimum of $2,000 is required to open a CD and must be deposited in a single transaction. A penalty may be imposed for early withdrawals. After maturity, if you choose to roll over your CD, you will earn the base rate of interest in effect at that time. The APY shown for CDs and IRA CDs is for a 60-month CD with a balance of at least $25,000. Click here for all CD rates and terms offered.