How to Become Financially Literate

How to Become Financially Literate

How to Become Financially Literate

A common question we get asked each year is about “how to become financially literate”. Not necessarily in those exact terms but the same concept. Financial Literacy is a combination of financial, credit/debt management, and the knowledge to make financially responsible decisions.
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However, in a study conducted by the Treasury Department on Financial Capability, 61% of the adults were unable to answer 3 or more of the 5 questions correctly. Furthermore, in a similar assessment of high school students, the average score on a financial literacy test was 69%. Nonetheless, that is okay because there are ways to improve your financial education. Also, we have a free quiz below that you can take to help you assess your financial prowess.
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One of the most important tidbits to remember is there are free resources to help you. One resource you can use is MyMoney.Gov to help you increase your knowledge in fun and interesting ways. Secondly, use a resource called Hands on Banking, provided by Wells Fargo. Hands on Banking is one of my favorites because not only does it cover different age groups but also covers tips for military and entrepreneurs. But enough about that, let’s talk about some tips before we jump into the assessment!

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Tips for Financial Knowledge

  1. Read periodicals: First, you should read newspapers and magazines geared toward money knowledge. The financial section of local/regional newspapers, Wall Street Journal, Fortune, Forbes, and Money are all great news resources. By reading the news sources you will remain abreast to what is going on in the financial world.
  2. Understand the 4-Methods of Making Money: Similar to our belief, Robert Kiyosaki, has a belief in there being four quadrants of making money. I recommend reading his book “Rich Dad’s CASHFLOW Quadrant: Rich Dad’s Guide to Financial Freedom“. In the book, you’ll learn about making money through employment (career), self-employment (freelance), business, and investment.
  3. Use financial management tools: Lastly, capitalize on the financial management tools that are readily available to you. Through these tools, you can connect your checking account, savings account, credit cards, and mortgage. Furthermore, using a tool like Mint helps you gain a better understanding of your own finances. Also, with Mint, you can track investments and receive alerts and advice.

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Now time for the quiz!
Share your results on Twitter, Facebook, or Instagram and tag us in it so we know what you got!

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