Do you know the importance of a solid financial education? You probably do. But do you actually have the knowledge, skills and confidence to manage even limited financial resources effectively? Most likely you don’t!
And, unfortunately, you probably didn’t get much help from your education system. That’s because very few schools include personal finance in their curriculum or ensure their students are financially literate before graduation.
This means most of us enter the adult world with no idea how to manage money, get out debt and build wealth. You may think that getting a degree and a “good job” will be enough, but it’s not. This is how most people end up living paycheck to paycheck with no hope of escaping their destructive financial cycle. The system has failed them.
But guess what? It’s never too late to learn and get on the path to Financial Freedom. You can apply the principles of financial literacy to your life and get the same results that the Financially Free have always understood and achieved.
Me: What are taxes and how do I pay them?
School system: worry not
— Isac Elliot (@IsacElliot) December 20, 2017
What is financial literacy?
Here are some questions: How does your money grow? How can you manage your financial resources to improve your situation—even when those resources are limited? Do you know the answers?
Because this is what you need to do to feel confident and secure about your financial future. The financially literate understand how to build wealth, to the point where it just seems to come naturally to them. But it doesn’t. No one is born financially literate—everyone must learn. And that means you, too.
You might think, “I understand finances, I just can’t get them to work for me!” Because there are so few opportunities available for a basic financial education, the sad fact is most people think they’re financially literate when they’re not.
And it’s not even just individuals. Look at the financial mess most countries are in these days, directly as a result of a lack of education. We teach people how to do a job, but we don’t teach them what to do with their money once they have it.
Not knowing how to make good decisions about managing your money or even just not understanding the basic principles is not your fault. Blaming yourself is just a waste of time. But it is something you need to fix so you can start changing your life. Because not knowing how to manage money causes damage that can follow you throughout the rest of your life.
The benefit of being financially literate
Learning how money works is the first step to successfully managing your money and live the life of your dreams.
image credit: Bigstock/misuma
Erin is the managing editor of MindShift.money and the owner of Lane Change Media. As a business owner and content provider, she takes her personal motto, “Don’t slow down, just change lanes” seriously. She lives in Los Angeles and has far too many pets.