Your Financial Literacy
Starting your financial
life and making the decisions that go with your independence can be intimidating.
The issues can be complex, the consequences of your decisions can be profound
and it can be difficult to find someone to rely on. You can turn to your
friends or your family for some help and guidance, but ultimately you
must assume the responsibility for making and living with your financial
The good news is that
with some time and effort you can become sufficiently well enough informed
to make sound decisions and feel comfortable with those decisions. The
additional good news is that by starting early to learn more about your
finances, you will have longer to put your knowledge to work and reach
your financial goals.
Here are some ideas
to help you learn to make better financial decisions and take control
of your financial future.
1. Take advantage
of the resources on the Internet. Many large and reputable financial
institutions (banks, credit unions, brokerage firms, mutual fund companies
and insurance companies) have extensive libraries on their websites
that address many of the issues you will face. Just be sure that the
websites you visit and learn from are legitimate and have your best
interests in mind.
2. Read some
of the personal finance columns in the newspaper. Many syndicated
columnists address complicated issues and boil them down to fundamental
approaches that you may find helpful.
3. Talk to knowledgeable
people. Your parents and friends that have financial experience
can be valuable resources. They may have already dealt with an issue
and you can learn from their experiences. If you speak with a sales
person, remember they may try to convince you to buy something, so be
careful. If it is a very critical issue or one that involves large sums
of money, consider talking with an accountant or attorney.
4. Read a personal
finance magazine. While you may not want to spend the money to subscribe,
by buying one occasionally or reading one in a waiting room, you may
find an article or two that is interesting and relevant.
5. Consider joining
an investment club. There are thousands of organizations that meet
regularly and actually make investments. Find one that suits your budget
and that meets at a convenient time. You may not make a lot of money
from the investments, but the discussions can be very informative.
6. Buy a personal
finance book. Every major bookstore has an aisle with dozens of
books. Find one that seems interesting and use it as a reference tool.
7. Consider personal
finance software. Using a program like Quicken or Microsoft Money
can make your bill paying and record keeping easier and faster. By spending
less time on those items, you can devote your serious finance efforts
to learning more about handling major financial issues. These programs
also have information or help sections you may find interesting. If
you are really interested in learning, you may even want to consider
a tax return preparation program like TurboTax. Using a program to prepare
your return will teach you a great deal about taxes.
It is never too early (or too late) to improve your financial literacy.
In fact, if you avoid major mistakes and do some of the most basic things,
you may find yourself on the road to controlling your financial future
with a lot less financial anxiety.