May 04, 2020

Our Insights

When times are tough, understanding your finances is more important than ever. But if numbers aren't your strong point that's ok. Here's how to sharpen your knowledge.

Why financial literacy is important

Having a broad understanding across all areas of finance, including budgeting, investment and market trends, is essential to helping you build your wealth.

Financial literacy can help you feel empowered and in control of your finances during difficult situations, and prevent you from making costly mistakes.

It’s incredibly important not just for your lifestyle and financial situation, but for your wellbeing.

Several studies show that at least 40% of Australians suffer from financial stress and anxiety, which is often a result of poor financial illiteracy.  

If you think you fall under this category of being financially illiterate, you’re not alone - a 2019 study from Spaceship revealed that over 55% of Australians admit to never being taught how to manage their finances.

There is often an assumption that becoming financially literate is complicated, confusing or simply too time consuming. However, all it really comes down to is some simple steps and the motivation to improve your knowledge.

How to become financially literate

Research

Researching online and offline is incredibly effective in increasing your knowledge (and best of all, it can be for free or for minimal costs). The internet provides a wealth of information via websites, blogs, e-books, podcasts, webinars, videos and more … the opportunities are endless. Plus, you can always rely on more traditional methods of research such as reading newspapers, magazines and finance books.  

Of course, not all wealth and finance educators and influencers are created equal! Make sure you're using credible sources for your research. Look to sources that have an established track record of success, qualifications and accreditations. It may also pay to look locally - finance can vary wildly between different countries, depending on local laws and circumstances. 

Enrol in free services

There are many free online courses on finance and money management available. Recommended websites to explore include:

Reach out to your network

Your network can provide amazing information and first-hand experiences for you to learn from (including what to do, and what not to do). Reaching out to your family, friends, colleagues or peers is an easy and comfortable place to start with those initial questions you have.

Focus on those in your network who walk the talk - who have credibility in matters of finance and wealth - most advice from family and friends is well meaning, but not all of it is good! We recommend you seek professional advice and clarification before making any major financial decisions.

Use financial management tools

Thanks to technology, finance management tools have become increasingly popular. There are many services and apps available which allow you to connect your savings, credit cards and more to assist you. Simple budgeting apps can also prove to be very useful. These apps can simplify your financial life and make it much easier to gather and understand your financial information. 

As a starting point, check out Pocketbook to track your spending. 

Resources

The following links are also highly recommended and reliable resources to get you started with financial literacy:

Get Advice

Being financial literate is important, but you don't have to be an overnight expert and you don't have to do it alone.

When you combine financial literacy with the advice of a financial expert, you're positioned to fast track your wealth journey and achieve your goals, without stress and uncertainty. 

We're here to help.

Talk to the team at Calder Wealth Management. Call us on (08) 8373 3333 to schedule your free initial appointment. 

Written by Anthony Hill at Calder Wealth Management. 

 

This is general advice only and does not take into account your financial circumstances, needs and objectives. Before making any decision based on this document, you should assess your own  circumstances or seek advice from a financial adviser and seek tax advice from a registered tax agent. Information is current at the date of issue and may change.