April is National Financial Literacy Month! Financial literacy is defined as having the knowledge and skills to manage finances and make responsible decisions for your financial wellbeing and future. Financial literacy benefits you by increasing awareness of your personal financial situation. The main purpose is to educate on what is considered standard practice and what are potential red flags that you should consider, as far as debt loads and other investments. Financial literacy (or financial education) teaches techniques and methods to help improve overall finances. A successful program can help to improve credit reports, increase your credit score, reduce debt or even help to discover ways to plan for large purchases and ensure success in your retirement years.
Most people do not consider their overall financial health until they prepare to make a large purchase such as a new home. Whether you are renting or purchasing a home, your financial situation will have an impact on that decision. Having an awareness of what is on your credit report, knowing credit scores and what constitutes an affordable home price is an important first step in the home shopping process. This is especially true in today’s housing market where individual sales happen quickly! There are sometimes several individuals competing to purchase the same home, and homes may sell above the listed price. In order to compete, you need to know your financial status and what you can safely afford.
Housing down payment assistance programs, such as the Virginia Individual Development Accounts (VIDA), provide matching funds to participants’ savings so they can use the funds towards closing costs and/or the down payment on their first home purchase. The VIDA program will match every one dollar saved with eight dollars in match for enrolled participants, up to $4,000 in matching funds. In addition, nonprofit organizations provide financial literacy training to VIDA participants. While participants are saving their money, they take part in financial education classes that aim to help them learn to manage their finances and prepare for their home purchase.
The VIDA program is a microfinance vehicle which provides small-scale, accessible capital to businesses and people while removing traditional barriers. As an example, the VIDA program is currently being offered in Floyd County by The Advancement Foundation (TAF).
“Financial literacy is the backbone and key element of success for the VIDA program. Financial literacy awareness is one of the best steps towards financial freedom and homeownership.”
– Kelly Turner, TAF Director of Regional Revitalization and Resources
As further proof of the VIDA program’s success, check out this personal testimony from Jasmine Bray:
“My name is Jasmine Bray, and I have learned about financial literacy within the past two years. I’ve had trouble my whole life with managing money. I knew very little about credit repair, homeownership, business ownership, grants, loans and how to access them and how they would work for me. In 2022, I entered into the VIDA program through TAF. I’ve learned so much in the past two years! The VIDA program and my mentor, Kelly Turner, have taught me about the process of homeownership. I was taught how to start a business and create a business plan and received a $4,500 grant for my business, Jazzy’s Soulfull Catering, LLC. TAF has helped me fix my credit for homeownership, helped me manage my funds through the financial literacy program, and they will help me with a loan for my business. I don’t know where I’d be without the VIDA program, TAF and, especially, Kelly Turner.”
If you are located within Floyd County and are interested in saving towards a home (first-time home buyer) or a small business, please contact Kelly Turner, TAF Director of Regional Revitalization and Resources, at firstname.lastname@example.org.