Aaliyah Kissick

The Importance of Financial Literacy

Financial literacy is a critical life skill that empowers individuals to make informed and responsible financial decisions. In today’s complex economic landscape, where personal financial choices have a profound impact on our lives, being financially literate is more important than ever. 

This informational page explores the significance of financial literacy, its definition, why Aaliyah is passionate about the subject, and provides statistics to highlight its importance.

What is Financial Literacy?

Financial literacy is a critical life skill that empowers individuals to make informed and responsible financial decisions. In today's complex economic landscape, where personal financial choices have a profound impact on our lives, being financially literate is more important than ever. This informational page explores the significance of financial literacy, its definition, and provides statistics to highlight its importance.

Personal Financial Stability

Financially literate individuals are better equipped to manage their finances, avoid debt traps, and maintain stable financial situations. They can create budgets, save money, and plan for unexpected expenses.

Investment and Wealth Building

Understanding investment options and financial markets allows individuals to make informed decisions about growing their wealth. Financial literacy helps in selecting appropriate investments and managing investment risks.

Debt Management

Financial literacy helps people understand the implications of taking on debt. It enables them to make informed decisions about borrowing, choose the right loan options, and manage debt effectively.

Retirement Planning

Being financially literate is crucial for planning a secure retirement. It involves understanding retirement savings accounts, investment strategies, and how to maximize retirement income.

Consumer Economics

Financial literacy is essential for active participation in the economy. It enables individuals to make informed choices as consumers, voters, and participants in financial markets.

Financial Wellness

A lack of financial literacy often leads to financial stress. Financially literate individuals are better equipped to manage stress, leading to improved overall well-being.

Financial Literacy Statistics

  1. High Credit Card Debt: According to the Federal Reserve, as of 2020, the total U.S. credit card debt surpassed $1 trillion, highlighting the importance of understanding credit and managing debt.

  2. Low Retirement Savings: A study by the National Institute on Retirement Security found that in 2020, nearly 57% of working-age Americans had no retirement savings, emphasizing the need for better retirement planning.

  3. Student Loan Debt: The Federal Reserve reported that in 2021, the outstanding student loan debt in the United States exceeded $1.7 trillion, emphasizing the need for informed decisions regarding educational financing.

  4. Financial Stress Impact: The American Psychological Association’s Stress in America survey consistently ranks money as one of the top sources of stress in people’s lives.

Aaliyah Kissick as Miss Illinois United States 2023 with German Bollero, Dean of the College of ACES at University of Illinois Urbana Champaign.

Aaliyah's dedication to finanical literacy

As a University of Illinois Student, I have learned the importance of proper money management and the impact it can make on families through my Financial Planning program. While I plan to be a financial advisor to people who need individualized instruction, want to share what I have learned with as many people as possible.

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