April is also Financial Literacy Month and a good time to boost your financial IQ. Some of the terminology around finances, like 401K, Roth contributions, 529 plan, company matching contribution, and dividends—just to name a few—can be intimidating and keep many of us from creating financial goals and jumping in to invest for the future. But it’s never too late to learn and get started.

A good way to begin is by taking advantage of the Consumer Financial Protection Bureau’s handy glossary of financial terms to get acquainted with some financial literacy basics. Then, see how you can apply them to your financial planning.

Five components to financial literacy

At its simplest, understanding financial basics boils down to five simple things:

• Income. In today’s world of direct deposits, it can be easy to overlook an important piece of financial information: your paycheck stub. Knowing exactly how much you earn and what deductions come out of your gross pay allows you to be an active decision-maker over items you control.
• Spending. Today’s apps make tracking your spending easier than ever, and many of them are free. Once you’re aware of where your money is going, it can be easier to cut back. Even a small change in spending habits can free up a few dollars a month to divert to a savings account. If you’re able, try to follow the 50 30 20 Rule: 50% of your net income for basic needs, 30% to non-essentials, and 20% to savings.
• Savings and investments. Think both short- and long-term when it comes to savings and investments. Emergencies are part of everyday life, from automobile repairs to a veterinarian emergency for the beloved family pet. Knowing you have that set aside can give you peace of mind. Long-term investments are one way to plan for retirement. Try to set 10% of your monthly income aside for your retirement fund, but this can vary depending on your age.
• Borrowing money. Almost everyone has to borrow money for big items like a home or a car. Taking care of your credit can help you get better borrowing terms, like lower interest rates, which can help keep your monthly expenses manageable.‍
• Protection. Be sure to monitor your credit report and your bank and credit card statements for any suspicious activity. Take advantage of your free annual credit report from annualcreditreport.com. If you’ve been the victim of identity theft before, it may be worth a small investment to pay for greater ID security.

Finally, don’t forget that Fidelity’s financial wellness tools and resources can help you prepare for retirement, assist with financial goals, and plan for health costs, so it never hurts to explore resources on NetBenefits.com and check in on your financial wellness.