If it seems like you can never get ahead, it’s time to fine-tune your financial literacy skills.

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You may have seen the term “financial literacy” pop up in online articles or heard it referred to on the nightly news. But do you really understand what financial literacy means? Fortunately, April is Financial Literacy Month, so there’s plenty of opportunity to learn about how to become more financially literate and improve your personal finance skills.

So, what is financial literacy, anyway? Financial literacy is mainly knowing and putting to use basic financial concepts, such as budgeting and understanding how interest works. Financial literacy also includes knowing how to get an auto or mortgage loan, making smart credit card choices, investing and planning for retirement, among other financial skills.

Could your lack of financial literacy be holding you back from achieving financial goals? If so, it’s time to graduate to a greater understanding of how to make better financial choices.

Click here to sign up for our free financial education email course.

1. You live paycheck to paycheck

You live paycheck to paycheck

Running out of money every month before all the bills are paid, being broke a week after payday and constant stress over money is a sure sign you need to improve your financial literacy. If this depressing scenario sounds like you, your first step towards better financial literacy is to create a budget so you know where you stand with income and expenses.

Budgeting doesn’t have to be a tedious task you dread, either. Make budgeting fun with a budgeting tool such as Mint or a similar app. To get the most of a budgeting app, download one that also tracks spending and offers tips based on spending and expenses.

Find out: How to Stop Living Paycheck to Paycheck

2. You don’t have an emergency fund

You don’t have an emergency fund

Few things are worse than needing money you don’t have for auto or home repairs, medical bills, or monthly bills if you lose your job. Oh, wait, one thing is worse: Racking up all those expenses on a credit card that you can’t pay off, so the balance haunts you for years.

Experts recommend having at least six months’ living expenses in an emergency fund, which is an intimidating goal, so start with a smaller goal – $1,000, for example – and then raise the amount each time you achieve a savings goal.

For tips on how to meet your savings goals faster, check out MyMoney.gov, a personal finance resource from the Federal Financial Literacy and Education Commission.

Find out: 5 Ways to Build Your Emergency Savings Fast

3. You’re not enrolled in your employer’s 401(k) plan

You’re not enrolled in your employer’s 401(k) plan

If you haven’t gotten around to enrolling in your company’s 401(k) or a similar retirement plan – especially if your employer tosses in  “free money” by matching a portion of your contributions each pay period – you probably don’t understand how investing for decades can grow retirement savings.

So, enroll now, even if you can only contribute a piddly 1%. Then increase the percentage incrementally. To begin learning more about how investing works, try reading an article or two every day at Investor.gov, a resource from the U.S. Securities and Exchange Commission.

Find out: 7 Pros and Cons of Investing in a 401(k) Retirement Plan

4. You can’t get approved for credit

You can’t get approved for credit

Are your applications for credit cards and loans routinely denied? If so, you need to improve your credit score. But first you must understand what’s on your credit report and the factors that determine your credit rating.

To learn the ins and outs of credit reports, credit scores, and how to improve your credit score, peruse the Consumer Financial Protection Bureau website. Then perform online searches for credible sites that offer short articles on credit scores, credit cards, loans, and specific factors you can work on to improve your credit.

Find out: 7 Ways to Repair Your Credit and Increase Your Score

5. You don’t understand how interest works

You don’t understand how interest works

Not understanding how interest works can land you upside down on your auto loan, make you a target for predatory lenders and keep you deep in credit card, student loan, or other debt for years. The good news is that once you understand how interest works, you can make better choices to save hundreds, or maybe even thousands, of dollars.

You’ll find credible information on how interest works at one of the major credit bureaus, such as this article on credit card interest by Experian. Other sources for easy-to-understand explanations of how interest works include personal finance sites, bank sites, and the Consumer Financial Protection Bureau.

Find out: 7 Tips for Negotiating Lower Interest Rates on Credit Cards

6. You think poor credit is a life sentence

You think poor credit is a life sentence

If you’ve demolished your credit and resigned yourself to a lifetime of payday loans, buy-here-pay-here car lots, and high-interest loans from shady lenders, guess what? You can still turn your credit around once you know a thing or two about improving your credit.

For one thing, time is on your side, since poor credit history accounts automatically drop off your credit report after seven years. Even bankruptcy only stays on your credit report for up to ten years. Meanwhile, you can build good credit history with a secured credit card – a card where you deposit an amount that matches the credit limit – by charging something small and paying off the balance each month.

But that’s not the only way you can improve your credit. As you pay down credit cards, the lower balances will probably also raise your credit score.

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About the Author

Deb Hipp

Deb Hipp

Deb Hipp is a full-time freelance writer based in Kansas City, Mo. Deb went from being unable to get approved for a credit card or loan 20 years ago to having excellent credit today and becoming a homeowner. Deb learned her lessons about money the hard way. Now she wants to share them to help you pay down debt, fix your credit and quit being broke all the time. Deb's personal finance and credit articles have been published at Credit Karma and The Huffington Post.

Published by Debt.com, LLC