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7 Tips For Improving Your Level of Financial Literacy

7 Tips For Improving Your Level of Financial Literacy
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Friday, 20 March 2020 03:04 PM Current | Bio | Archive

Americans really aren’t all that savvy in terms of financial literacy.

A recent survey of adults in their thirties found that the majority of respondents lacked a basic understanding of financial terms. Of those who took the survey, nearly half didn’t understand what interest is, how bankruptcy works, or even possesses a basic understanding of inflation.

That lack of knowledge can have long-term negative ramifications. It may lead to credit cards with high-interest payments, paying more than necessary in banking fees, and does little in terms of helping people amass a nest egg – or any savings, for that matter. This financial literacy deficit also comes against the backdrop of a nation that owes trillions of dollars in unsecured debt.

Fortunately for you finance noobs, nowadays, you don’t have to go through your adult life financially blind. Gaining all the knowledge and savviness won’t happen overnight, but you can, in fact, become a financial literacy guru; all it takes it education, experience, and determination. Keep reading to find out how to get yourself started on the path of financial literacy.

Improve Your Financial Literacy With These Tips

1. Get Over Your Fear

Mortgages, interest rates, and inflation are all financial topics that conjure up fear and confusion for many Americans, leaving them paralyzed to act. But financial literacy doesn’t have to be scary, and the sooner you can overcome your fear the quicker you will be on your way to boosting your knowledge. It may seem daunting and there will be concepts you may not grasp but inaction due to fear is not an option.

2. Take Baby Steps to Boost Your Knowledge

A large swath of Americans are procrastinators, putting off what they can do today to tomorrow. If you fall into that category of people and are serious about increasing your financial knowledge, you’ll have to shelve that urge. If you want to become more financially proficient, vow to start boosting your knowledge now instead of later.

Taking baby steps can ensure you don’t give up within a week or two of getting started. Just begin with a topic near and dear to your heart. If you’re struggling with student loan debt, become an expert on the topic and how to reduce it, including government and private sector programs. If high-interest rate credit cards have you stuck, learn all you can about the topic.

3. Tap Government Resources

Like it or not, the government is an amazing resource on financial literacy. Both state and federal government agencies go to great lengths to arm consumers with knowledge about personal finance, provide tips on how to manage finances, and issue alert to keep Americans safe from scammers and hackers.

Take MyMoney.gov. A product of the Congressionally-chartered Federal Financial Literacy and Education Commission, the website provides visitors with information on managing finances, getting out of debt, and how to protect assets among other things. The website has a section geared toward youth, teachers, and educators and researchers.

4. Peruse the Internet

The Internet has radically transformed how we access information, but not all information is true, nor is the good stuff all free. Indeed, some platforms, such as the Wall Street Journal, require a subscription. However, these platforms can be a valuable source of education for those seeking to improve their financial literacy. Reading about finance, if it’s not a passion of yours, may seem dry in the beginning but there are fortunately many platforms that offer digestible and easy-to-read information on the topic.

5. Take a Class

If you don’t want to teach yourself about finance, you’re in luck; financial literacy classes are a thing for that very reason. There is a bevy of classes and workshops you can take to boost your financial knowledge. Aside from online courses, local banks, credit unions, and public libraries also offer seminars and classes, often for free, on different financial topics, such as the tax season. Many libraries will hold special seminars specifically on filling out and filing your taxes leading up to the April deadline.

6. Don’t Be Afraid to Ask for Help

Despite your best efforts, sometimes financial topics can be too confusing to navigate on your own. That’s when it may be time to call in the experts. Many people balk at calling an expert for fear of the cost, or that they will appear stupid, or even because they don’t think they have enough money invested or saved to get help. The reality is that everyone can use some financial help from time to time, often at little to no cost.

Need help getting out of debt? There is a slew of nonprofits that will offer cheap or free debt counseling. Looking to invest but don’t know where? Robo advisors have popped up all over the Internet to provide low-cost, computer-driven investment advice.

7. Tap Online Financial Tools

From mortgage calculators to investment clubs, the Internet has become a one-stop shop to enhance your financial knowledge. These days, you can figure out your payments on a new car loan or mortgage, determine how long it will take you to pay off a credit card, and learn how to invest – all without having to leave the comfort of your living room. There is also a bevy of mobile apps that will help you budget and save, and otherwise manage your finances. While they can’t replace financial literacy, they can definitely supplement it.

Final Thoughts

Financial literacy may not top the list of must-haves for countless Americans, but it should. Without a basic understanding of personal finance, you won’t know if you’re choosing the right credit card, making a sound investment, or are saving enough for your retirement. That can set you up for financial struggles in the future. Thankfully, there is a slew of ways to boost your knowledge nowadays. It may be dry and complicated in the beginning, but the greater your financial literacy the better off you will be over the long haul.

Carly Fauth is Head of Marketing and Outreach, as well as a personal finance expert at MoneyCrashers.com. Carly has a diverse background in marketing, publicity and advertising and has also worn many hats working for various startups.

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Americans really aren’t all that savvy in terms of financial literacy.
7, tips, improving, financial, literacy
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2020-04-20
Friday, 20 March 2020 03:04 PM
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