5 Must-Know Financial Literacy Topics
Updated November 2025
Knowledge is power, but it’s also financial health. With the right information and understanding of certain subjects, the way you treat money can entirely change—hopefully for the better. It’s Landmark National Bank’s goal to make sure as many people are financially literate as possible, so we as a society can make well-informed decisions beneficial to ourselves and others.
In the spirit of financial wellness month, we’ve compiled financial tips to help enhance your financial education. Hopefully, we’re able to provide you with an intuitive explanation of these subjects so that if you haven’t started to think about them yet, you can begin now.
Why is Financial Literacy Important?
Financial education is important because it helps you understand the best ways to use your money in both the short and long term. When you’re skilled and smart about your money, you’ll find yourself less financially stressed, less wasteful, and better able to pursue your financial goals.
What is Financial Literacy?
Financial literacy is the ability to understand and use financial skills effectively—from personal budgeting and saving to managing debt and investing. In simpler terms, it’s knowing how money works and how to make it work for you. Being financially literate means you can make informed decisions about your finances, set realistic goals, and navigate financial challenges with confidence.
Financial education isn’t just for finance experts—it’s a life skill that impacts nearly every decision you make. Whether you’re choosing a credit card, planning for retirement, or deciding how much to spend on groceries each week, financial literacy provides the foundation for making smart, informed choices. It helps you understand the long-term effects of your spending, borrowing, and saving habits.
Today, financial literacy has never been more important. A financially literate person can avoid common pitfalls like overspending, high-interest debt, or poor investment decisions. They’re better equipped to plan for emergencies, build wealth, and protect their future. Financial literacy gives you the power to set goals, make smarter decisions and create a more secure financial future.
#1: Personal Financial Management & Earning Money
Also known as PFM, personal financial management is the simple practice of organizing and tracking your spending, accomplished through the use of a budget. A personal budget is a plan that helps an individual or family understand what they can and cannot afford, what their anticipated expenses are, and how to measure their different income streams, among other goals orbiting finances. Mastery over a budget and PFM can empower people to feel more in control of their money.
Personal finance refers to managing your money in ways that support your short- and long-term goals. It includes five key areas: income, spending, saving, investing, and protecting your assets. Learning how to balance these areas helps you stay in control of your financial life and avoid unnecessary stress.
Personal Finance Basics
A strong personal finance foundation begins with a personal budget. Tracking income and expenses helps you see where your money is going and where you can make adjustments. Once your essentials like housing, food, and transportation are covered, you can begin allocating funds toward savings and debt repayment.
Next comes building an emergency fund. Life is unpredictable, and having three to six months of expenses saved can be the difference between stability and financial hardship. Managing debt responsibly is another key piece, paying bills on time and keeping credit card balances low help maintain a healthy credit score.
Lastly, think about the future. Setting up retirement accounts, investing in growth opportunities, and protecting what you’ve earned through insurance all contribute to long-term success. With consistent habits and smart decisions, personal finance management becomes a lifelong tool for confidence and control.
#2: Protection & Insurance
Insurance exists as a countermeasure against potential loss. In exchange for a premium—a certain agreed-upon sum of upfront payment—as well as consistent, ongoing payments, an insurance company will agree to financially support an individual or company should misfortune befall them in the future. The exact policies and conditions are subject to change based on the insurance company, as well as the type of insurance you’re securing, so it’s important to carefully consider your needs and what insurance might benefit you the most.
Some common types of insurance include: health insurance, life insurance, travel insurance, car insurance, property insurance, liability insurance, and disability insurance, among others.
#3: Spending
We spend money for a nearly endless variety of reasons. We need to spend money on monthly and annual bills, subscription fees, mortgage/rent, groceries, recreation, property upgrades, medical premiums, and so on. By spending money, we’re stimulating the economy, upholding our responsibility as citizens, and enriching our lives through the things we love.
In the discussion about why financial literacy is important: this is why it’s important to spend money effectively, taking us back to PFM and the power of a good personal budget. When we know our money coming in versus money going out, we can take the steps to spend money in intelligent, well-considered ways.
#4: Borrowing
Among the financial literacy topics, understanding the importance of borrowing money is critical. Poor borrowing decisions can deal tremendous damage to the long-term health of your budget and lifestyle, chaining you to frustrating, nonoptimal repayment plans. But loans themselves are not the enemy, and can serve as a boon in some circumstances.
A well-chosen loan can help you out of an unexpected emergency scenario, get your promising new business on its feet, or allow you to make an important life transition. Before committing to any new loan, ensure you understand the institution behind it, the terms and conditions, interest rates, additional costs, and any involved collateral. All of these details should be outlined in the contract you’ll be asked to sign.
#5: Saving & Investing
Essential to the financial literacy training experience is the understanding of how saving and investing can elevate your financial portfolio. You’ll find many practices surrounding exactly how much you should save and when; but virtually every source of wisdom agrees you should be saving something.
A good savings account can provide lucrative benefits, such as making you more money the longer you have cash sitting in it. Other healthy practices include:
- Not spending all of your money as soon as it comes in
- Stowing part of it away in case of emergency
- Saving money in anticipation of a large purchase, like the down payment on a car
Investing is an extension of saving. It’s wielding your money in a way that the money is allowed to grow on its own. Like everything else on this list, investing is an entire skill unto itself, and can take years to cultivate. However, a strong investment profile can create unrivaled financial security and generate you wealth in addition to your income.
Understanding Credit Options
As you’re working on your personal finances, credit cards can be a powerful tool to manage spending, if used wisely. Understanding the different types of credit cards available can help you choose one that fits your lifestyle, spending habits, and goals. When choosing a credit card, compare annual fees, interest rates (APR), and rewards programs.
Financial tip: The key to financial health using credit cards is all about consistency. Make payments on time and keep your balance low to maintain a strong credit score and support your financial wellness.
Types of credit cards
- Standard credit cards offer a simple way to make purchases and build credit. Paying off your balance in full each month avoids interest and demonstrates responsible use.
- Rewards credit cards provide cash back, points, or travel miles for everyday spending. These cards can be beneficial if you pay your balance monthly, allowing you to earn perks without accumulating debt.
- Secured credit cards are ideal for individuals who are new to credit or rebuilding their credit history. They require a refundable deposit, which acts as your credit limit and helps establish good credit behavior over time.
- Low-interest or balance transfer cards can help you manage existing debt. These often feature introductory rates that make it easier to pay off balances faster and save on interest.
Learn More and Live More with Landmark
The learning never stops. Though we’ve covered some of the basics, remember each of these financial literacy topics can go far deeper. We’re here to help with financial tips and guidance to help you manage your daily finances and long term goals.
To continue in the spirit of financial wellness month, Landmark National Bank would like to encourage you to explore the benefits of our personal savings account, designed to help you earn interest and invest in your future. This is a great next step toward learning how financial literacy is important, and how it can directly improve your life.
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Your credit score is broken down in detail on your credit report, which is a summary of your credit history and usage. In short, your credit report basically determines your score. Checking your credit report frequently can help you catch potential errors made by the credit agencies that generate the reports and possibly improve your credit score. You can get a free credit report at annualcreditreport.com, a website run by the three major credit bureaus in the U.S.
