The Financial Literacy Guide

First: know where the money goes

Track one month of spending — every dollar, no judgment. Then use the simplest budget that exists: needs, wants, savings. A common starting split is 50/30/20, but the numbers matter less than the habit. A teenager with a part-time job who saves anything consistently is learning the single highest-value skill in this guide.

Credit: the score that follows you

• Understand what it is: a history of borrowing and repaying on time. Landlords, employers, and lenders all look.
• The two rules that build it: pay every bill on time, and keep credit card balances low relative to their limits.
• A secured credit card or becoming an authorized user on a trusted relative's card are the standard safe starting points.
• Check reports free at annualcreditreport.com — errors are common and disputing them is free.
• Avoid the traps aimed at your neighborhood: payday loans, rent-to-own, and buy-here-pay-here car lots are wealth extractors.

Investing: time beats timing

The biggest advantage a young person has is decades of compounding. Boring, low-cost index funds through a reputable brokerage — inside a Roth IRA once there's earned income — outperform almost every exciting alternative over time. If someone promises fast guaranteed returns, they are describing either luck or a scam.

And the wealth-builders beyond the market: employer retirement matches (free money — always take it), homeownership approached carefully, and ownership of skills or a small business. That's what 'generational wealth' means in practice: assets and knowledge that transfer to the next generation.