Over the past few months, a few things have prompted me to consider to what extent money plays a role in success. We often think of money as a result of success, but could it be a prerequisite? That is: might you need money in order to obtain success?
In the last post, we looked at why it’s so important to read widely in order to avoid bad financial advice. In this post, we’ll take a look a some of the specific ways you can evaluate sources to find good financial advice.
My original title for this post was ‘How can I find good financial advice?’
But when I read through the draft, I realised I’d have to save that for a follow-up. Most of what I had written focused on avoiding bad financial advice.
Like language, money is a symbolic system we use to communicate with each other. Kids’ exposure and sensitivity to language begins early, and the same may be true of money. The majority of opinions agree financial education ‘begins with children – the younger the better’. In the last post, we looked at what an important role financial education and family background has in influencing outcomes in life.
But where do – and where should – kids learn about money?
New Years is often the time we start thinking about resolutions and goals – and reflecting on the year gone by.
For several years, while we were working towards our financial independence, I kept a Financial Journal in which I would write down all of my savings goals, and notes from the (many!) finance books I read. Of course, you can use an online solution, but studies have showing that writing down your goals leads to greater conviction, and handwriting what you learn helps you to remember it.
I kept my Financial Journal in a gorgeous ‘Money Planner’ I had been eyeing off for some time (although naturally, I waited until I found a slightly dented copy reduced to half price!) but you can use pretty much any notebook you have on hand.
As I sit here ready to leave Fiji, I am reflecting on some of the things I’ve learned over the past couple of months, and particularly, during our final volunteering placement with IVI, which we finished up yesterday. One of which is a new perspective on the question ‘Is it a need or a want?’
I knew that we were going to a remote island school, and having had some experience in an even smaller, even more remote village in Fiji before, thought I knew what to expect. But I didn’t. The school we were placed at had very different opportunities and challenges.
I love words, language, and reading – and most of all, books. New or old, I love them all.
But when it comes to books spouting financial advice, it pays to check the publishing date, just like it pays to check the manufacture and use-by dates on packaged foods.
So how are financial books like cases of wine with sour milk?
In 2009 and 2011, Americans and Australians respectively were asked five ‘basic’ financial literacy questions. Only 43.8% of the Americans and 36.5% of the Australians managed to get all five correct. And it’s not only ‘average’ Americans and Australians – a 2002 survey of 530 online investors, who we might expect to be more financially savvy also found that half could not pass a simple financial literacy test.
But what is financial literacy?