If you’re visiting this site, there’s a pretty good chance that you imagine yourself to be fairly savvy about your finances. At the very least, you’re open to learning from those who are in the know. If that’s the case, congratulations are in order, because you’re probably not in the majority here in Australia.
At least, that’s the conclusion drawn by the University of Melbourne, whose Household, Income and Labour Dynamics in Australia (HILDA) survey, which set-out to measure overall financial literacy for the first time. The results weren’t encouraging. Fewer than half of the respondents were able to answer all five basic financial literacy questions now included in the survey.
That’s not even the half of it. Data from ASIC seems to support the same conclusion, with only 35% of Australians reporting that they know the exact value of their super at any given time. In a nation where almost half of near-retirement homeowners still have a mortgage hanging over their heads – that’s a recipe for disaster.
If you’re among the majority of Australians that fits into this inauspicious financial category, there’s still time to make amends.
To get your journey toward financial literacy started, consider taking a crash course at MoneyMinded. In their 8-step financial literacy program you’ll learn all about how your attitudes toward money shape your financial habits, how to control your spending, and what to do to prepare for a secure retirement. At the very least, you’ll come away from the activities with a decent understanding of the major topics of financial literacy so you’ll know what to explore next.
ASIC is doing more than just keeping track of Australia’s financial wellbeing. They’re also taking active measures to improve it. That’s the point behind MoneySmart, which is the agency’s portal for personal financial knowledge. If you’ve got a money topic, chances are they’ll have a handy guide covering at least the basics of it. That’s not all, though – they also provide free tools like:
● Budget Planners ● Tax Calculators ● Retirement Planners ● Super Contribution vs. Mortgage Payoff Comparator
MoneySmart will give you access to the basic financial knowledge you need, and the tools to put what you’ve learned into action. It’s a no-brainer for anyone traveling the road to financial literacy.
Although reading articles on personal finance is helpful (and thanks for reading, by the way), sometimes there’s just no substitute for a true two-way back-and-forth with a live financial planning expert.
You can get that by heading over to the personal finance webinar page at The Davidson Institute. Participation in the available webinars is free, and they provide an excellent opportunity to ask the presenter specific questions to enhance your understanding of the covered subjects.
When it comes to financial topics, confusion is always the enemy, so having the ability to get some clarity is invaluable and will dramatically improve your financial literacy.
Since every individual has their own financial circumstances, sometimes a general understanding just isn’t enough. If that’s true for you (as it was for me), some more advanced learning is in order.
To get it, you can avail yourself of any of the many financial planning courses now available online or in person all over the country. The courses can cover anything from personal financial management, all the way up to certification programs for those looking to become professional money experts - check out Kaplan or Training.com.au for the latter. The bottom line is, they give you the knowledge and ability to master your own financial destiny. And if you come to like the subject matter, they could even help you move into a whole new career helping others with their financial needs.
Don’t keep the steps a secret. If you believe, like I do, that a rising tide lifts all ships, share your experiences with a friend of family member when you’re next catching up. Everyone is in the same position as everyone else - not really knowing how or where to start. It certainly makes for a better financial conversation that everyone can take part in, rather than just the usual one about who just bought what house, and for how much.
Once you’ve done what it takes to increase your financial literacy, you’ll be well equipped to start building a future based on sound money management and keen investment choices. That will make it possible for you to live the kind of life that you want without fear of spending your golden years trying to make ends meet. You can look forward to reduced financial anxiety and stress, plus the freedom to really plan and set some financial goals. Mark the date in the calendar today that you want to feel this way, and work backwards. You can do it if I did, you’ve just got to put in the training.