Financial literacy is an important, lifelong personal finance skill that everyone should have because it fosters careful spending and informed decision making. Responsible personal finance habits will guide you toward a life of financial freedom, and increasing your vocabulary of money words can only help. Here are five money definitions you should add to your financial literacy repertoire so you know how to get the most out of your money and financial decisions.
1. Credit Score
Your credit score impacts many facets of your life including getting a loan for a car or house and being approved for a credit card. Because a poor credit score can have such a negative impact on your life, it’s important that you frequently check your credit score. Experts recommend checking your credit report at least once a year to catch errors or identity theft.