A proper education is a terrific thing. And while the American education system has its pros, it certainly has its problems as well. One of its larger issues is that it doesn’t properly prepare the American youth for the financial challenges brought on by the “real world.” There are multiple things that all Americans must know about their finances, but they simply aren’t taught them in school; this leaves younger (and even current) generations vulnerable to financial missteps.
So, how can you avoid these pitfalls? I’ve compiled a list of a few handy things to know about your personal finances.
There are two certainties in life: death and taxes. This old adage is depressing, but, unfortunately, true. So, if we can’t avoid them, we should do our best to learn as much as we can about them. The overall basic idea behind taxes is this: you work and earn wages on a weekly basis, and a portion of those wages are given to various government-related institutions (social security, federal taxes, etc.).
While it may sound unfair at first, these taxes are used to contribute to your community, both on a local and federal level. And the beauty of the situation is that you can file for a simple tax return. And you don’t have to navigate the waters of taxes on your own; you can use tax software like TurboTax or speak with actual accountants, and they’ll ensure that you’re in Uncle Sam’s good graces.
If you’re going or have gone to college, unless you’re wealthy or have a full-ride scholarship, then you are very aware that you need student loans. And since the majority of Americans are living with student loan debt, it’s certainly something that we should all be knowledgeable on. A few good things to note are that not all loans are the same; subsidized loans do not require interest until after graduation, whereas unsubsidized payments collect interest as soon as you start college. Additionally, you may need to pay off student loans longer than you think if you consolidate. This makes the monthly payments lower, but makes the overall payment time much longer.
These are just a few useful things to understand about your finances that you may have not learned in school. Take this information and make the best financial decisions you can.