Financial Literacy: A Few Useful Facts
Just What Is Financial Literacy and Why Do You Need It?
Would you start to build a house with no knowledge of wiring, plumbing, or carpentry at all? Chances are that your results would be much more successful if you begin with at least some basic skills and knowledge, and even better if you took enough time to acquire at least a moderate level of competence in basic building techniques.
Investing effectively and profitably requires an understanding of techniques and strategy as well – financial literacy. This literacy is often used to indicate knowledge of personal finance including family budgeting and control of income and expenses. True financial literacy goes far beyond personal finance to encompass such considerations as estate planning, tax planning, insurance needs, evaluation of retirement needs, and certainly managing your investments.
Many adults were found to be woefully lacking in financial literacy in a survey of 150,000 adults covering nearly 150 countries. The survey consisted of five basic questions across four topics that include understanding of inflation, compounding, interest, and diversification. Globally, men fared slightly better than women with a pass rate of 35% compared to 30%. Sadly some developed countries rated quite poorly, with the US ranking 14th at 57% passing, behind Scandinavian countries Norway, Sweden, and Denmark which each topped the rating at 71%.
Results of several surveys indicate that many otherwise educated adults and even teenage participants may be unable to make wise financial decisions or invest intelligently. Many would be well advised to take steps for improving their abilities to evaluate investment opportunities or realize the need to consult with reputable resources to solicit professional advice. There are many benefits to becoming financially literate:
- Improving your income
- Saving money on purchases
- Investing profitably
- Secure retirement planning
- Reducing tax burden
- Reduce debt
How to Acquire Financial Literacy
Fortunately there are many ways to gain or improve your financial literacy. In the internet age there are seemingly endless resources on web sites with information on how to get started on improving your understanding of financial matters. These can include basic household finances, managing loans and savings accounts, and other financial instruments such as retirement accounts and personal investments. As with any internet searching beware of sites that may be bogus help sites actually working to part you from your hard-earned money. Remember the wise old adage that “if it sounds too good to be true, it probably is”.
Other more formal channels for financial literacy are available as well:
- Financial news – both magazines and daily publications such as Forbes and the Wall Street Journal provide informative articles and columns of benefit to both businesses and consumers
- Radio and television programs – numerous talk radio and especially cable television broadcasts provide financial and investment advice
- Read – literally thousands of books on every financial topic are available in many languages
- Formal education – many community colleges and continuing education organizations offer classes in financial subjects including personal investing and day trading
- Join an investment club – many communities have groups of like-minded individuals willing to share ideas and experiences that can help mold your financial literacy and investment strategy. Some even combine financial resources to provide a larger pool of investment capital, sharing in the profits (and hedging their losses).
Regardless of the method or combination of methods you select to increase your financial literacy, the key is to get started now. Delays only put off reaping the advantages you will gain from understanding interest rates, retirement planning, and personal finance options including investment diversity and day trading techniques.
Putting Financial Literacy to Work for You
Without some level of financial literacy day traders and other investors are up against significant disadvantages in managing their personal finances as well as their investments. Understanding risk aversion and basic company financial information such as market indexes and trends are critical to making investment decisions that are right for you.
SureTrader is a leading online broker with the tools you need to stay up-to-date on investment news that impacts your buy and sell decisions. Understanding market charts and news feeds can help you to hone a strategic edge that promotes financial success. Stock tickers available with real-time market information keep SureTrader clients aware of emerging market trends and business activities that savvy day traders can react to quickly for advantages over less informed investors. SureTrader’s friendly and courteous support is available to our clients on a 24×7 basis to answer any questions and resolve problems. Information from multiple exchanges in national and global markets enables you to make the right investment choices based on current conditions to align with your individual financial needs.
SureTrader’s lightning-fast execution of your trades provides a competitive advantage. Desktop and mobile applications ensure timely and flexible access to SureTrader services – iOS and Android platforms are each supported. SureTrader’s global services enable quick and easy trades even in after-hours trading.
Contact SureTrader right away to get started doing online trading with the best in online brokers.
Disclaimer: SureTrader Blog is not intended for U.S. persons. Stock information is not to be viewed as buy or sell recommendations.