Other than breathing, one of the few daily realities we all share is managing our finances. From paying your rent on time at age 25 to trying to buy that beachside home at age 65, money is one of the few constants at every stage of your life.

While breathing feels natural, balancing your bank accounts is not an innate habit. You will need to do some homework to build your financial literacy skills.

What is financial literacy?

Financial literacy is having an adequate level of knowledge about personal finance (such as saving, budgeting, credit management, investing, taxes, insurance and more) so that you can make informed and effective decisions with your money.

Being financially literate means that you have a grasp of the fundamentals of smart spending and saving decisions and that you know where to turn when you need some assistance. Think about when you have an illness or an injury: You have to know whether the ailment is something that can be fixed with over-the-counter medicine or if you need to visit a doctor. So, don’t worry: Financial literacy doesn’t mean you need to be an expert with a master’s degree in money.

At the very least, financial literacy involves tracking your spending to know where your money is going. That’s the starting point for staying out of debt, paying down debt, saving and investing.  As money starts to feel more complex — how to maximize your tax deductions or what the best strategy is for saving for a child’s college tuition, for example — financial literacy helps you know who to call for advice with those tougher questions.

Why does financial literacy matter? 5 reasons

Just as being literate helps you read traffic signs on the highway, complete job applications online and respond to text messages from your friends, being financially literate is an equally crucial ingredient to help you navigate life by monitoring your money, avoiding mountains of credit card debt and saving for your future.

If reading stories and watching videos about budgeting, interest rates and retirement plans doesn’t sound like fun, consider some of the main benefits you’ll enjoy by investing a small amount of time in improving your financial literacy:

1. Get better sleep

Getting a good night’s sleep is critical to your wellness, but money can get in the way. Bankrate’s survey findings revealed that more than 30 percent of Americans are staying awake, worrying about everyday expenses. Financial literacy helps you lay those concerns to rest — literally.

2. Feel more prepared

If you’ve been stressing about everyday costs, what will you do when an unexpected expense arises? An introduction to financial literacy teaches you the importance of having an emergency savings fund to take care of curveballs like a major car repair, a medical bill or a job loss.

3. See yourself through the eyes of a potential lender

Being financially literate isn’t just about your own knowledge; it’s also about understanding how banks and credit unions might assess your financial skills. With a grasp on the importance of your credit score, you can have a good idea of where you stand when applying for a mortgage or a car loan. Consider financial literacy as a pathway to empower yourself with a better estimate of the type of terms a lender should offer you.

4. Spot a bad deal when you see one

All those preapproved offers for credit cards and personal loans that arrive in the mail or land in your inbox may sound appealing, but they’re likely worth shredding or deleting. Being financially literate gives you the ability to scan those terms and immediately recognize warning signs.

5. Work less

Learning the basics of finance early means enjoying your time later. If you can see how the value of compounding interest will accelerate the growth of your retirement fund, perhaps you can move your retirement date a bit earlier on the calendar.

Tips to fuel your financial literacy

Take advantage of free learning opportunities: If you’re just beginning on the road to financial literacy, there is an increasing number of resources that can take you a long way on your journey — and they won’t take a penny away from your own finances. Create an account with Bankrate for personalized articles tailored to your needs, budgeting tools and quizzes to monitor your progress, or download an app that can help scrutinize your spending decisions.

Evolve your education: There are different pillars of financial literacy at different stages of life. Your need for knowledge will evolve over time as your needs and goals change. Financial literacy begins with the basics of budgeting, credit building and saving, but as you mature, it will expand to include investing, insurance, taxes and potentially estate planning. As you approach bigger life decisions — buying your first home, having children or determining what to do with an inheritance, for example — continue to educate yourself on the implications of different choices you are considering.

Trust someone else, but always stay in the driver’s seat: Never fully abdicate the responsibility for your finances. While it’s OK if your partner or investment manager handles the nuances of managing the money, you still need to have a supervisory role with knowledge of what’s happening.

Finally, if you have kids, make personal finances part of their learning routine, too. Whether that’s sitting down to talk about the basics of investing or using a family vacation to highlight the power of goal-setting, it’s never too early to put financial literacy on the at-home curriculum.