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April is Financial Literacy Month, a perfect time to examine what you might not know about your own finances.
According to a Global Financial Literacy Survey, only 33% of adults worldwide demonstrate basic financial literacy, highlighting how common these knowledge gaps are.
Even seasoned wealth managers and finance professionals can uncover gaps in their understanding if they look deeper.
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Personal finance is how you and your family manage money to achieve your goals. This includes management of your income, spending, investments, tax strategies, estate and legacy planning, family planning, gifting to loved ones, covering long-term care costs, special needs planning, insurance protection and more.
Financial literacy matters at every stage. In your high-earning years, it helps you build wealth with confidence. As you approach retirement and generational planning, it helps you preserve it with intention.
Below are three key areas of personal finance with actionable steps for both the accumulation and preservation stages.
Wealth transfer and legacy planning
Wealth accumulation
This stage often includes those in their 30s to 50s, professionals with rising incomes, employee stock and growing families. Many people in this group are balancing careers, childcare, mortgages and early wealth building.
Your goal might be to create a strong foundation that protects your growing wealth and provides clarity for your loved ones.
- Create or update core documents. This includes your will, powers of attorney and health care directives. If you have minor children, confirm guardianship choices.
- Review and align beneficiary designations. Retirement accounts, life insurance and transfer-on-death accounts often pass outside the will. Make sure they match your intentions.
- Understand basic trust concepts. Learning how revocable and irrevocable trusts function could prepare you for future planning and might be necessary now if you have a loved one with special needs.
This stage is about structure. The earlier you build it, the easier it becomes to expand and refine over time.
Wealth preservation
This stage commonly includes retirees, empty nesters, business owners and families and individuals with higher net worth.
Individuals in this category are often thinking about how to reduce taxes, transfer assets efficiently and prepare heirs for future responsibility.
A coordinated plan helps create continuity and equips future generations with clear guidance.
Investment literacy and risk management
Wealth accumulation
This stage includes those who are high earners in their peak career years, saving aggressively and working toward building a higher net worth.
This stage is about transforming income into long term wealth through discipline, consistency and thoughtful planning.
- Set a clear savings and investment targets. Over time, aim for 15% to 25% of income, depending on goals and timing. Automate these contributions.
- Build a diversified portfolio. Use a mix of stocks, bonds and cash that matches your risk tolerance and helps you stay invested during market swings.
- Use tax-advantaged accounts effectively. Maximize employer retirement plans, health savings accounts and additional deferred savings options available to you.
Investment literacy protects you from emotional decision-making and fully harnesses the power of compounding during your highest earning years.
Wealth preservation
In this stage, individuals or couples might have multilayered portfolios, real estate holdings, private investments or business interests.
When your focus shifts to preserving wealth, investing becomes more complex. It’s no longer only about growth but also about sustainability and long-term risk control.
- Align your portfolio with long-term needs. Plan for annual cash flow, gifting and legacy planning, and consider different time horizons for income, stability and growth.
- Use a liquidity and stability framework. Maintain short-term reserves, midrange stability assets and long-term growth assets to support spending and help reduce stress during volatile markets. Factor in tax efficiency across investment and withdrawal strategies.
- Document an investment-policy statement. Clarify your goals, allocation ranges and decision rules, so your plan remains consistent across market cycles. Factor in any private or alternative investments so your overall allocation and liquidity remain balanced.
An intentional investment strategy can provide growth today while preserving opportunities for tomorrow.
Financial communication and decision-making
Wealth accumulation
This stage often includes those who manage busy households, growing careers, aging parents and increasing financial complexity. Wealth is rising, but time is limited, making communication essential.
Healthy communication builds strong financial habits and reduces stress during the years when life is busiest and financial decisions multiply.
- Hold regular money conversations. Review goals, spending, saving and investment updates to stay aligned.
- Clarify roles and responsibilities. Identify who manages bills, who oversees investments and who works directly with advisers.
- Organize your financial documents. Use a secure digital vault for estate documents, insurance, tax returns and account information.
These habits create clarity and confidence as your financial life becomes more complex.
Wealth preservation
Families with adult children, blended families, retirees and multigenerational households managing shared assets, inheritances or business interests are typically in this stage.
As wealth grows and multiple generations become involved, intentional communication becomes essential for smoother decision-making and healthier family dynamics over time.
- Create a family mission or set of guiding values. This helps frame decisions and creates shared purpose around your wealth.
- Set a meeting cadence. Regular family meetings provide structure for communication, education, and collective decision making.
- Document guidelines and expectations. Create clarity around distributions, shared assets and participation in family business or decision-making.
Strong communication strengthens relationships and supports long-term stewardship of wealth.
Bringing it all together
Financial literacy is not something you check off a list. It’s something you build over time as your life, goals and financial responsibilities evolve.
Whether you’re in the wealth-accumulation stage and focused on building a strong foundation or in the wealth preservation stage and preparing for multigenerational success, the choices you make today shape your long-term financial confidence.
Personal finance can involve complexities, but with the right knowledge and the right partners, you can create a life and legacy that reflects your values and supports the people you care about most.
