9 Ways to Upgrade Your Financial Literacy
When it comes to financial matters, a lot of people still remain uninformed on crucial aspects. Even though developing a financial plan should be a top priority from an early age, a lot of people are blissfully unaware of its relevance. The lack of enough information and the intimidating reputation of the stock market and economic jargon further adds to financial ignorance and sometimes complete financial illiteracy. Thankfully, there are many ways to educate and keep yourself up to date so that you are able to gain the most of the opportunities that come your way.
Here are 9 easy methods to upgrade your financial literacy:
- Read as much as you can
- Refer to podcasts
- Rely on technology
- Take a financial course
- Consult a financial advisor
- Take help from peers and seniors
- Get in touch with a real estate expert
- Learning the implications of debt
- Knowing the cycles of the market
One of the best forms of learning is to read. There is plenty of material available on financial matters. You can begin reading economic journals or newspapers to keep yourself acquainted with what happens on a day to day basis. Additionally, you can also subscribe to government resources, such as the Financial Literacy and Education commission. The commission is affiliated with the U.S. Treasury Department and offers a good insight into both public and private sectors. You can also browse through MyMoney.gov to grasp basic principles of financial learnings. You will find all the required information on how to save, earn, borrow, and invest your money. The website offers help on retirement planning, debt management, and many more things. Additionally, you can also consult online forums such as the Wall Street Journal, Fortune, Forbes and more.
If reading is not your preferred source of information, you can switch to podcasts. Podcasts are an effective way to learn new niches. You can listen to them while commuting to work, during a lunch break, or even as you walk on the treadmill. BiggerPockets Money Show, Afford Anything, Listen Money Matters, etc. are some podcasts that offer simplified information on finance, real estate, entrepreneurship, saving, and investing. Podcasts can be adjusted to your schedule easily and help you grasp even complicated components of financial planning in a swift and quick manner.
Technology has bridged many gaps in knowledge in the last few years. Robo Advisors have been the newest members to offer flexibility, affordability, and practicality to investors. Robo Advisors are able to gauge your risk appetite based on your future goals via their algorithms. This offers a smooth process with little to no intervention from your end. You can also rely on companies, such as Mint, Blooom, and YNAB with their award-winning applications and software that cater to many routine needs. These apps are instrumental in taking over tasks like budgeting, planning, money management, savings, etc. You can also buy financial calculators from Hewlett-Packard, Canon, or Texas Instruments to calculate loan payments, rates of interest, mortgages, annuities, and more. They considerably reduce the time spent in such affairs and present a more structured view of your money.
Taking a financial course can be a good way to master the elements of financial planning. While reading and listening to podcasts can offer suitable information, enrolling in a course provides you with personalised attention from your instructor/ teacher. This can be particularly great if you are interested in a certain component of financial planning. You can take up a course of your choice at an adult education centre or look for a part-time private or community college. You can also consider an online class. There are many online study forums that give you degrees from some of the best educational institutions in the world. This gives you an opportunity to learn from the most competent teachers and experts in their respective fields.
A financial advisor can help you in numerous ways. Right from offering advice on investment, savings, debt, to assisting you with estate planning, they cover many grounds. They can also educate you about the latest financial happenings of the world. A financial advisor can help you understand how a change in a government policy can affect your tax liability or how the world politics can impact the market forces and ultimately the returns from your investment. It is recommended to pick a well-experienced and certified professional.
Learning can be all the more useful and easier when done with friends or colleagues. If your peers or a senior at work is well-versed with financial matters, you can reach out to them. Merely keeping in touch with friends and asking them about the retirement accounts they have invested in, or the stocks and bonds they have put their money in will also give you an idea of what is suitable for you. Although it is never advisable to blindly follow your friends and families, taking their suggestions can be one of the many ways to keep yourself updated with the options you have in front of you.
Real estate is often a neglected aspect of financial planning. Most people only look at real estate from the point of view of buying their home. However, real estate is also a viable investment that can fetch you great returns over the course of a few years. But real estate can be more complicated than it seems. Firstly, it is a costly investment. Secondly, many other factors, such as the area, purpose of investment, and local laws, etc. can determine the fate of your investment. A real estate expert can help you grasp these concepts.
As important as it is to know the various forms of savings and investments, it is also vital to comprehend the implications of debt on your net worth. Most people tend to overlook this aspect of financial planning. No amount of learning or financial literacy can save you if your debt overpowers your earning capacity. Therefore, it is essential to learn ways to manage your debt. Prioritizing your purchases and limiting your credit card uses are some of the easiest ways to incorporate this habit.
The market can bloom one day and crash the other. Global events, country politics, as well as demand and supply can increase or decrease the value of stocks. This can be unnerving for some investors. However, if you know how the market works and are familiar with its cycles, you will be able to predict and place your bets accordingly. Learnings about market forces and its cycles can put a stop to unwanted panic and anxiety. It will also enable you to take advantage of the opportunities ahead of you.
To sum it up
There are several ways to upgrade your financial literacy. But it is important to note that this has to be a constant effort. The financial world changes often, and only the ones who pay attention to its every move can truly benefit from it. While it can be difficult to keep tabs on each activity, you can always adopt daily practices like reading or listening to podcasts. Moreover, you can also get in touch with a Financial Advisor to clear any doubt or query in your mind.