Financial Literacy Month is an excellent opportunity to expand your financial knowledge. Let’s explore four essential concepts that can elevate your financial skills.

April marks Financial Literacy Month, dedicated to increasing awareness about the importance of understanding personal finance. Financial literacy means knowing how to earn, manage, and invest money. A lack of financial understanding can cost you dearly; Americans estimated a loss of $1,819 in 2025 due to financial illiteracy, according to the National Financial Educators Council. Just think of the possibilities—whether it's investing, making an extra mortgage payment, or saving for your child's education.

Even those who feel financially savvy can still discover new insights. We spoke with several financial educators who shared key terms they believe more people should understand. Here’s their take.

APR and APY

Mykail James emphasizes the importance of grasping APR and APY. “Both terms start with ‘A’ for annual. If your savings account has an APY of 5%, you don't earn 5% monthly; the bank divides that amount by 12. Similarly, credit cards with an 18% APR don’t incur 18% monthly charges. This confusion is common,” she explains.

Expense Ratio

Tess Waresmith highlights the “expense ratio” as a critical term for investors. “It’s an annual fee expressed as a percentage that investors pay for holding mutual funds or ETFs,” she states. “This fee covers operational costs like management and marketing. Expense ratios typically range from 0% to over 1%.”

Waresmith adds that while these percentages may seem minor, they compound over time. You don’t need to be an expert, but understanding these fees can enhance your portfolio's returns. Exploring investment options with lower fees, such as Index Funds and ETFs, is also beneficial. Remember, financial education should happen all year, not just in April!

Rethinking “Good” and “Bad” Financial Decisions

Financial educator Allison Kade believes it’s essential to rethink the ideas of “good” and “bad” money choices. “Each person’s financial situation and mindset are different; what’s beneficial for one may not be for another,” she explains.

She points out that while debt is often viewed negatively, it can sometimes be a valuable part of a financial strategy. “For instance, buying a home can significantly increase one’s net worth, but it may not suit everyone’s goals or lifestyle,” she adds.

Your Credit Report Matters

According to Susan Bistransin, your credit report acts as your “lifelong report card.” “After school, no one monitors you like the credit bureau does,” she says. Bistransin, who works as a financial education coordinator in Maryland, has been recognized for her commitment to teaching financial literacy.

A recent study revealed that over 30% of Americans don’t even know their credit score. Ignorance about your credit history and report can negatively impact your score or expose you to identity theft. If you’re unsure how to review your credit report, click here. “Understanding credit is crucial for managing your finances effectively,” she notes. “It can be a powerful tool or lead to financial trouble if mismanaged.”

Final Thoughts

Financial Literacy Month provides a perfect chance to refresh your financial skills. Yet, maintaining this knowledge year-round can significantly improve your financial health for the future. “Money is a universal aspect of life,” Bistransin asserts. “Knowing how to handle it is essential for everyone, regardless of your financial situation. Everyone should learn how to make their money work for them.”