What does financial literacy mean? 5 definitions from success stories

April is Financial Literacy Month and to celebrate, CNBC is featuring tips from some of our contributors. Here’s what they think about financial literacy and its impact on their lives.

CNBC contributor Stephanie Link is chief investment strategist and portfolio manager at Hightower, a wealth management firm that provides retirement planning services to individuals. Straight out of college, Link received advice that would shape his long-term investing philosophy.

“Right out of college, my dad suggested I take money out of my paycheck and put it in the S&P 500, in an ETF, and just the average dollar cost each month. He said you’ll never see it. You won’t miss it. And he said it could be $5, it could be $25. But that was the point of investing long term and to not worry about the daily movements of the markets. today use this process in my style of investing.”

The Latino population, more than 63 million people, is the fastest growing ethnic group in the United States. But Esther Aguilera, president and CEO of the Latino Corporate Directors Association, says the Latino community still lacks access to leading personal financial products and the industry needs to do a better job of bridging that gap.

“Did you know that 12% of Latino households are unbanked and 22% are underbanked? In this financial literacy month, let’s remember that investing in Latinos is smart business.”

For Jim Lebenthal, CNBC contributor and chief equity strategist at financial advisory firm Cerity Partners, being a financially competent investor means understanding potential risks as much as the potential return of an investment. And this focus on risk must go beyond stocks.

“When I talk about investing, it can be more than just a stock or bond. It can be a full investment plan, a full asset allocation.”

Finances can be confusing. In fact, some institutions rely on industry jargon and complicated language to convince the average person that they can’t understand finance like the pros.

For Guy Adami, CNBC contributor and director of the Private Advisor Group, financial literacy can empower investors to ask better questions, which, in turn, will improve the financial industry as a whole. And he says recent history provides a compelling reason why individuals shouldn’t trust the industry for more.

“The great mythology of the years was that no one understood money better than we do. We on Wall Street. Well, 2008 and 2009 proved that to be the exact opposite. Now we can ask questions that we don’t. never asked on Wall Street before.”

Understanding how the financial system works will increase personal wealth, according to CNBC contributor Nelson Reyneri, who is ESG director at consulting firm Point B and president-elect of the American Hispanic Chamber of Commerce. He learned from personal experience.

“I arrived with my family when I was three and a half from Cuba. And we had nothing but 50 dollars and lots of dreams. But what we learned is that we live in a country, that for those who are willing to learn how the financial system works, educate themselves and work hard, there are ways to increase their personal wealth. This is an exciting journey and I encourage all Americans to Take advantage of many free resources to learn more about personal finance.

People can improve their financial literacy for free, in most cases, with resources from sites like the Council for Economic Education.

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Disclosure: NBCUniversal and Comcast Ventures are investors in tassels.