August 14, 2023

Why National Financial Awareness Day Matters

Estimated reading time: 3 minutes

For some, financial independence can feel like a faraway goal. National Financial Awareness Day on August 14 is the perfect opportunity for us to take a close look at our money habits and how they can influence our larger economic profile.

Why is Financial Awareness Important?

As our culture continues to move to a digital financial landscape, it’s become more important than ever to be on top of your money. According to an April 2023 NerdWallet survey, 74% of Americans have a monthly budget. However, 84% said they exceed their budget each month. Nearly half (44%) of survey responders said they used a credit card to pay for expenses when over budget. Additionally, a 2021 survey by Federal Bank of San Francisco found that only 20% of consumer purchases were made with cash.

Spending and Budget Plans

Budget planning can be an important tool. Many people may think budgeting should only include the essentials, but that isn’t necessarily true. While it’s a good practice to include food, transportation, and debt costs into your budgeting, experts advise to also lay out a spending plan as well.

Seeing where your money goes each month can help you create and maintain goals.

Set Savings Goals

According to experts, most Americans should aim to have between three to six months of emergency savings. However, 22% of U.S. residents don’t have any emergency savings at all, per a Bankrate survey conducted in May, 2023. This percentage only grows when looking at younger generations. Members of Gen Z are the least likely to have emergency savings, with 31% reporting to have no savings at all.

Starting is often the hardest part, so be sure you’re setting realistic goals for your savings! If you set a lofty goal, it’s often difficult to see your journey to success. Instead, start small. For six months, try to set aside a small portion of your paycheck. Having a savings account dedicated to your rainy-day fund is a great way to visually track your money growth.

Small Changes with Big Impact

When you’re beginning to make financial changes, small changes can have a large impact. While saving a few dollars here and there can feel like chump change, building habits can help you save over time and help us feel accomplished.

If you often get delivery or takeout for meals, try replacing one meal a week with one you’ve made. One meal replacement can help you save nearly $50 a month.

We all have that one subscription service that we don’t really use but continue to pay for to keep it “just in case.” Removing a streaming app that isn’t utilized can help you save up to $10 a month, or $1,200 a year.

Get Credit Healthy

Your credit is closely examined in loan applications. Sometimes, it can even be the determining factor for whether you’re approved. Your credit also influences your interest rate and the terms a lender provides.

A woman smiling up at someone as she holds her phone in one hand and her credit card in another.

At Homestead Funding, we want you to financially succeed and reach your homeownership goals! When you work with one of our dedicated Loan Originators, you’re working with a home financing expert. They can give advice, help you connect with a credit coach, and make sure your goals are met! When you’re ready to get started, reach out to us today!

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