Whether you consider it a necessary evil or a beneficial tool that allows you to fulfill your needs and reach your objectives, there’s no denying that money makes the world go round. It’s an integral part of our lives as it underpins the very structure of modern society. Therefore, knowing how to manage your money and making smart financial decisions is not just a useful skill but an essential necessity.
Unfortunately, as data proves it, financial literacy is not a priority for many individuals or educational institutions. Ironically, we live in a world where money influences nearly every aspect of our existence, but people are financially illiterate, and that has to change.
The financial knowledge gap
Given the crucial role that money plays in ensuring people’s basic needs and keeping things running smoothly in the world, one would think that educational systems in all countries would pay special attention to teaching students key financial concepts and skills that would empower them to take control of their financial life later on and build a bright future for themselves.
But as it happens, most schools around the world don’t include financial education into their curriculum or offer very limited educational options in this respect. As a result, a large number of individuals reach adulthood without having solid understanding of how money works or how to manage them properly, let alone grasp more complex topics like what factors impact the Bitcoin price. Luckily they can head to websites like Binance to learn more about the subject.
According to the 2024 TIAA Institute-GFLEC Personal Finance Index (P-Fin Index), almost half of US adults lack financial literacy. Across the pond, the 2023 Eurobarometer survey shows that a quarter of EU residents who participated in the study scored low on financial knowledge. So, we’re looking at a global issue here that should serve as a wake-up call for decision-makers from all over the world.
The majority of people develop their financial knowledge from a combination of sources, including their families and peers, past mistakes, and random information they’ve picked up along the way. Needless to say, that’s not the most effective way to build a strong financial foundation and ensure a prosperous future.
Closing the gap
Despite the terrible statistics, the good news is it’s never too late to become money savvy and learn about budgeting and money management, debt management, saving and investing, retirement planning, and other crucial money-related aspects. Even if the educational system has failed you, there’s still time to fill in the gaps and improve your financial literacy, so here are a few ways you can achieve that.
Hit the books
Although this might seem like an outdated method to learn new things in a day and age where everything is digitalized and there’s a tech tool for just about anything, books remain a great source of knowledge and information that you shouldn’t disregard. So, you can either head to your local library or purchase finance books that cover topics you’re interested in. You’ll come across all sorts of books that address all kinds of money-related issues, so make sure the ones you include on your reading list are adequate for your level of financial proficiency so you don’t end up spending your money or your time on publications that are either too basic or too complex for your understanding.
Tune in to podcasts
Nowadays, a lot of people prefer to consume content via audio materials as this format is best suited for their busy lifestyle, allowing them to listen to topics that are relevant to them while also engaging in other activities. With the demand for audio content being higher than ever, you can find podcasts that cover a wide variety of financial subjects, from the best asset classes for investing to trading platforms, how to set up a web3 wallet, and many other interesting issues. The Ramsey Show, So Money, Optimal Finance Daily, and Planet Money are among some of the best-rated podcasts at the moment, so have a listen, and maybe you’ll become a fan.
Go back to school
Since we’ve highlighted the shortcomings of the formal educational systems in helping students achieve an adequate level of financial literacy, you might be reluctant to take this path to expand your financial knowledge and skills. However, it should be noted that not all educational institutions are created equal, and some of them offer great finance courses and programs that might be a good fit for you. Sometimes, traditional education is the best method for acquiring relevant information and thus laying a strong financial foundation. So, there’s no harm in exploring this option and researching different opportunities in this area as well.
Go online
The internet is not just for mindless scrolling on social media apps and watching cute cat videos; it can also serve as a great resource to educate yourself if used correctly. So, if the idea of going back to school doesn’t appeal to you, you can always continue your educational pursuits online and take advantage of the wealth of information it offers in the form of online courses, tutorials, newsletters, webinars, apps, and so on. This gives you the flexibility to build a customized learning experience and learn at your own pace, using the tools and channels that align with your interests and needs.
Final thoughts
Financial education is not an option but a necessity. It’s difficult, not to say dangerous, to move through life without knowing and understanding basic financial aspects like money management, saving, or investing. Therefore, achieving an optimum level of financial literacy is something we should all strive for, and the methods listed above can certainly help you a lot in achieving this objective. As long as you are motivated and stay committed to your goal, you’ll have no problem enhancing your financial literacy.
