April isn’t just about filing taxes—it’s also Financial Literacy Month, a perfect opportunity to reflect on your financial habits, expand your knowledge, and take meaningful steps toward improving your financial well-being. Whether building your first budget, preparing for retirement, or navigating the complexities of paying for college, financial literacy is the foundation for making confident, informed decisions.
It’s important to remember that financial literacy isn’t something you master once—it’s a lifelong journey of adapting, learning, and growing as your circumstances and goals evolve.
Here are some practical steps you can take today to strengthen your financial foundation:
Lessons from Tax Season—Turning Insights into Action
Tax season may not be anyone’s favorite time of year, but it has a way of sharpening our focus on finances and decisions over the past year. It’s also an opportunity to reflect and identify changes that could improve your financial situation—and potentially your tax outcomes—for the year ahead.
Reflect on Your Tax Return: As you gather your records to share with your tax professional, it's a good time to identify patterns in your income, expenses, and deductions. Determining how much is coming in vs. how much is going out is the first step in creating a realistic budget.
Spotting overspending or missed opportunities may help you change your behavior and adopt better financial habits that could benefit your financial health in the long term. It's also worth reviewing your tax withholdings to see if they align with your current situation.
Common Gaps in Record Keeping: If tax time is always a last-minute scramble for documents, receipts, and other paperwork, learn from this year’s experience and commit to being better prepared for next year.
A good tax document organization system can help you track income, deductions, and expenses year-round. Being organized can make it easier to calculate taxes accurately, claim deductions, and make smart financial choices.
Having disorganized tax documents can cause issues like late filings, missed deductions, and lost records. Missing deadlines could mean extra fees. Overlooking deductions could cause missed opportunities. And lost records could have multiple negative ramifications.
For physical paperwork, consider setting up folders or binders for different types of documents. Think of separate folders for personal bank statements, medical records, and investment statements. Arrange papers in chronological order or by categories inside these folders so you can easily find them. Label folders clearly and keep them in a filing cabinet or a fireproof box.
In today’s world, go digital. Many financial institutions send tax documents electronically. Download them and save them to a digital folder. For physical documents, scan them and save them to the same folder. Arrange these digital files in folders and sub-folders on your computer or an external hard drive—just like you would with paper copies.
Many financial professionals offer clients access to a secure digital vault. These tools help you store and organize your financial documents so they are accessible when needed. Whichever method you choose, regularly backing up your digital files can help avoid any potential data loss.
These record-keeping ideas are not a replacement for real-life advice. We would encourage you to speak with your tax, legal, and accounting professionals before modifying your record-keeping strategy.
Using Your Tax Refunds: According to IRS data from February 2024, the average tax refund amount was $1,395 in 2024, down nearly 29% from $1,963 the previous year. Of course, this is just an average, and your refund might be higher, lower, or non-existent if you owe the government money.
If you receive a tax refund, here are a few ways to put it to use:
Build Your Emergency Fund
An emergency fund is one way to help manage unexpected expenses or layoffs. If you can't put away three to six months of expenses in your savings with your regular paychecks, your tax refund can boost that number.
Pay Down High-Interest Debt
If you carry a balance on credit cards or other high-interest debt, consider paying down that balance and free up your budget.
Tackle Maintenance Costs You’ve Been Postponing
Have you postponed car issues, appliance problems, or home repairs because of the costs? Consider using extra cash from a refund to address these needs before they get worse and potentially more expensive to fix later.
Better Yourself
You could use your tax refund to invest in yourself. Ideas could include taking a course at a local college, getting a certification that could improve your job prospects, or finally starting that side hustle you’ve been thinking about.
Invest Extra Cash
If you receive a larger refund, work with your financial professional to invest that money.
Spring Clean Your Financial House—Declutter & Organize
Financial wellness includes taking steps to declutter and organize your financial life. Many tools and resources make spring cleaning your financial house more manageable and efficient. Here are a few areas you can focus on:
Digital Financial Organization:
Moving your financial life online has become the preferred method for many. It can be more convenient while helping to manage the clutter of physical mail and stacks of paper on your kitchen counter. Online bill pay, digital account statements, and electronic documents are commonplace.
While streamlined digital access has many benefits, one downside is the proliferation of passwords you need to remember. Technology can also help with this. Password managers are available online to help you keep track of your complex and varied passwords for each key account.
While doing your financial spring cleaning, it’s also a good time to review and update those auto-payments if necessary.
Fraud Protection Checkup
Spring is also a good time to review the security of your identity and personal data, especially when using online accounts.
Security can be a real problem. A 2024 Federal Trade Commission (FTC) study showed that consumers reported losing more than $10 billion to fraud in 2023, marking the first time that fraud losses have reached that benchmark. This statistic marks a 14% increase over reported losses in 2022.
To help protect yourself, consider monitoring your financial accounts regularly for suspicious activity, especially during tax season.
You can attempt to enhance your online security to protect sensitive information by using strong, unique passwords, enabling multi-factor authentication, and regularly changing passwords.
Don't let your mail sit uncollected for too long. A low-tech way criminals can steal your identity is to simply take bank or credit card statements, utility bills, health care or tax forms, or pre-approved credit card offers out of your mailbox. As you declutter, consider buying a household shredder and destroying sensitive paperwork containing personally identifiable information.
Create different passwords for your accounts. According to the FTC study, secure passwords are longer, more complex, and unique. Many people use the same password for multiple accounts, which could be problematic. You should create different passwords for various accounts and avoid using information related to your identity, such as your pet’s name, your birthday, your initials, or parts of your name.
The FBI and the National Institute of Standards and Technology have issued guidelines stating that passwords should comprise at least 15 characters because these are more difficult for a computer program or hacker to crack. Regarding security questions, the FTC’s guidelines suggest questions that only you can answer; avoid information that could be available online, such as your ZIP code, city of birth, or mother’s maiden name.
Account Consolidation:
Streamlining your financial life can include combining old or forgotten retirement accounts. Accounting for all your assets and having them in one place can help you and your financial professional develop more comprehensive investment and retirement income strategies.
Surprisingly, losing track of an old retirement account happens more often than you might think. As of May 2023, there were over 29 million "left-behind" or "forgotten" retirement accounts in the U.S., holding nearly $1.65 trillion in assets. Whether or not the balance of a forgotten account is large, this can be “found money.”
Also, remember to look for other long-dormant accounts that can be consolidated, and inactive or redundant credit cards that can be canceled.
Beneficiary and Insurance Checkup:
Use this annual opportunity to update your beneficiaries on policies and retirement accounts.
Not reviewing your beneficiaries on retirement accounts and other key contracts and policies can cause unintended consequences. Typically, a beneficiary designation overrides any instructions detailed in a will. For example, you may leave everything to your spouse in your will. If you named your children as beneficiaries on your retirement account, at your passing, the retirement account designation might supersede anything written in your will. As a result, the money in that account could go to your children instead of your spouse.
Beneficiaries listed on an account opened long ago may not reflect your current circumstances and may no longer match your estate goals. This can be true with divorce, the birth of a child, or the death of a beneficiary. So, including a review as part of your spring cleaning is good.
Building Better Money Habits—Small Changes, Big Impact
When getting your financial house in order, even minor changes, consistently applied over time, can have an impact. Some ideas can be implemented independently, while a financial professional might help with others.
Simplify Spending Tracking
Creating a budget and sticking to it is an important step in taking control of your finances. You can determine your cash flow, track expenditures, and account for assets and liabilities on an old-school spreadsheet or with digital tools. If you want to go high-tech, there are many budgeting apps to consider. Here are a few that may be of interest:
o YNAB (You Need a Budget) (Paid Subscription)
Overview: YNAB focuses on proactive budgeting, helping users keep track of their finances. It might help someone who wants to track spending in real-time and manage money more intentionally.
Features: Real-time tracking of credit card spending, debt payoff ideas, and goal-setting.
Ideal user: Someone who wants detailed control over their budget.
Platform: iOS, Android, and web
o Quicken Simplifi (Paid Subscription)
Overview: Simplifi by Quicken is a modern budgeting app designed to give users a clear, real-time snapshot of their finances. It helps track spending, set goals, and plan for upcoming expenses with minimal setup.
Features: Automatic syncing with bank accounts, customizable spending plans, real-time updates, cash flow projections, and goal tracking.
Ideal user: Someone who wants a sleek, automated way to manage money and track progress toward financial goals.
Platform: iOS, Android, and web.
o Mint
Overview: Mint was one of the original budgeting apps, offering a clear snapshot of your finances by syncing to your bank accounts, credit cards, and bills. It automatically categorizes transactions and helps you set budgets and track your financial goals.
Features: Budget tracking, bill reminders, credit score monitoring, spending categorization, and financial goal setting.
Ideal user: Someone who wants a well-established, free tool for automatic expense tracking and simple budgeting.
Platform: iOS, Android, and web.
o PocketGuard
Overview: PocketGuard helps users see their disposable income after accounting for bills and savings goals. It connects to bank accounts and credit cards to track real-time spending.
Features: Budgeting, spending insights, savings goals, and debt payoff ideas.
Ideal user: Someone who wants a simple way to see what’s safe to spend.
Platform: iOS, Android, and web.
o Spendee
Overview: Spendee is a simple, user-friendly app that allows manual entry or syncing with bank accounts and credit cards. It offers an easy-to-use interface for tracking spending by category.
Features: Budgeting, spending tracking, and expense categorization.
Ideal user: Someone who wants a visually appealing, straightforward app.
Platform: iOS, Android, and web.
o Goodbudget
Overview: This app uses the envelope budgeting method, where you assign money into different "envelopes" for each spending category. It helps users stay mindful of their spending without linking to bank accounts.
Features: Envelope budgeting, spending tracking, and reports.
Ideal user: Someone who prefers manual entry and a simple, disciplined approach to budgeting.
Platform: iOS and Android.
o Rocket Money
Overview: Comprehensive personal finance app designed to help users manage their money more effectively.
Features: Tracking spending, creating custom budgets, monitoring credit scores, along with the unique and most-advertised assistance in canceling unwanted subscriptions and negotiating lower bills on behalf of users.
Ideal user: Someone looking for as simply, inexpensive, centralized platform for tracking and optimizing their financial activities.
Platform: iOS, Android, and web.
Automate Savings
Many people struggle to prioritize saving and building an emergency fund, but automation can help. Setting and forgetting your savings strategy can help as you tuck away a bit of your monthly income without remembering to make transfers. Not only does automation remove the mental barrier of having to remove money from one account to another, but you may also be more likely to stick to the pattern when you don’t have to remember to make a transfer.
Automate Investing
Just like with savings, automating investing can make it easy and efficient to build a nest egg for retirement, put assets aside to cover education costs, or tackle other goals. Working with your financial professional, you can determine what works best for you, your timeframe, and your risk tolerance.
Automatic investing can also help you practice dollar cost averaging (DCA). However, DCA does not protect against a loss in a declining market or guarantee a profit in a rising market.
Specifically, DCA is investing a fixed amount of money in an investment vehicle at regular intervals, usually monthly, for an extended period, regardless of price. Investors should evaluate their financial ability to continue making purchases through periods of declining and rising prices. The returns and principal values of stock prices will fluctuate as market conditions change. Shares, when sold, may be worth more or less than their original cost.
Review Your Investment Strategy
Spring may also be a good time to speak with your financial professional about your current financial strategy. Working with your professional, you can determine if your investment portfolio needs to be rebalanced because of market gains or losses, whether changes to your goals or timeframes require tweaks to your strategy, or whether your overall financial situation has changed.
Family Money Talks—Building Financial Confidence at Home
Financial literacy is something that the entire family can benefit from. While talking about money can be uncomfortable for some, ignoring the family's financial issues will not make them go away. The more you normalize financial conversations, the easier it is for you to talk about problems if they arise or eventual estate strategy discussions as you get older.
Partners Need to Communicate
Tension can build when partners do not manage finances well, struggle to talk about money, or aren’t honest about spending. Sometimes, ongoing tension leads to separation or divorce. A 2024 Fidelity Couples and Money Survey found that 45% of partners said they argue about money sometimes, and one in four couples say money is their top relationship challenge.
Spring can be a good time for couples to discuss finances. When you discuss money more consistently, your conversations will get easier and feel more normal.
Couples may also want to meet with an objective third-party financial professional who can facilitate the conversation and help develop a comprehensive financial strategy.
Children of All Ages Need Exposure to Financial Literacy Concepts
If you have children, get them involved in age-appropriate family discussions about financial literacy and money matters.
Younger children can be introduced to financial concepts like earning an allowance through chores, saving money to pay for things they want, and learning that money has value.
Teenagers can be taught the importance of working a part-time job to earn money while learning about budgeting, credit basics, and the deferred gratification of saving for larger goals.
It might be appropriate to include adult children in estate strategy discussions and know where your important documents are kept and your healthcare directives.
Children learn by example, so if you show good money behaviors like saving, budgeting, and investing, you can start creating a strong financial foundation for your children. You can also create teaching moments by involving children in shopping decisions or charitable donations. These real-life scenarios can go a long way toward explaining financial concepts.
30-Day Financial Refresh Challenge
To help manage financial stress, tackle one of your financial spring cleaning tasks per week so they don’t become overwhelming. But remember, financial literacy and health is a continuous process. So, starting small and staying consistent may be the best way. Here are a few ideas that may help you jump-start the exercise for the month:
Action Steps for the Next 30 Days:
Week 1: Review your tax return and set one financial goal
Week 2: Organize digital and physical financial documents
Week 3: Create a written or digital budget
Week 4: Have a money talk with family or review investment strategy
Working with a Financial Professional
Taking control of your finances can feel overwhelming, but small, consistent steps can make a big difference over time. Whether you’re organizing your financial documents, learning more about budgeting, preparing for major life events, or reviewing your long-term financial goals, each action strengthens your financial foundation and can build your confidence.
When you’re ready to take the next step, we’re here to guide you. From helping you create a comprehensive financial strategy to helping you leverage tools like secure digital vaults or educational resources, we’re committed to empowering you with the knowledge and strategies you need to pursue your goals. Financial literacy isn’t just about knowledge—it’s about having the proper support to make informed decisions for your financial future.
Let us help you turn your goals into a strategy!
Sources
1. DataSnipper, August 25, 2023 https://www.datasnipper.com/resources/how-to-organize-tax-documents
2. IRS, February 2, 2024 https://www.irs.gov/newsroom/filing-season-statistics-for-week-ending-feb-2-2024
3. Federal Trade Commission, February 9, 2024 https://www.ftc.gov/news-events/news/press-releases/2024/02/nationwide-fraud-losses-top-10-billion-2023-ftc-steps-efforts-protect-public
4. U.S. News & World Report, May 4, 2024 https://www.usnews.com/360-reviews/privacy/identity-theft-protection/10-ways-to-prevent-identity-theft
5. Capitalize, June 23, 2023. Once you reach age 73, you must begin taking required minimum distributions (RMDs) from your 401(k) or any other defined contribution plan in most circumstances. Withdrawals from your 401(k) or any other defined contribution plans are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty. https://www.hicapitalize.com/resources/the-true-cost-of-forgotten-401ks/
6. Trust&Will, December 2024 https://trustandwill.com/learn/beneficiary-designation-vs-will
7. Forbes, July 30, 2024 https://www.forbes.com/advisor/investing/dollar-cost-averaging/
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