Everybody has heard of the saying 'knowledge is power'. But do we really know what it means? Well, for starters it means that if you have more knowledge about anything then you are in a better position to make decisions.
In fact, the more knowledge you have about something, the better decisions you will be able to make on that particular subject. This applies to everything from personal finances to relationships and even business, especially when they are tied into specific goals or objectives.
For example: If someone knows they want to retire early then they need access to specific information that can help them achieve this goal with minimal risk involved (or at least less risk than if they were just guessing).
However; if someone doesn't understand how compound interest works then there is no way they could ever plan properly for their retirement because compound interest can play such an important role in determining how long it will take for their savings accounts/investments grow into something substantial enough for them not have to work anymore.
A person's level of financial literacy may affect their ability to manage different types of assets, liabilities, income streams and expenses in order to achieve their short-term and long-term goals. In addition, it also affects directly or indirectly the amount they save for retirement or emergencies.
We also have very little knowledge or guidance when it comes to investing our hard-earned dollars or managing debt—a topic that can be a bit complicated for even those who are financially savvy. Just google how to manage debt and see the different results you get.
For example:Thinking that getting a credit card means buying whatever item catches your eye without worrying about how much it costs because “there's always room in my budget for something new!” This way of thinking isn't uncommon among people who lack financial literacy—and it can land them in deep water if they aren't careful about their spending habits (or don't consult experts before taking out a loan).
Read financial websites. This is also a good source to acquire financial knowledge, looking at it from the perspective of different individuals. It’s not like I’m bias or anything but leofinance.io is a great source to acquire financial knowledge. Based on personal experience, my financial knowledge had a boost and broadens in scope ever since I started engaging in the community.
If reading is not your thing or doesn’t sound visually appealing, you can learn through watching financial videos. Youtube is the main hub but any other reliable place will do. There’s a lot of information on the Internet. You may already know that there are many ways to get financial advice; however, some of it is good and some isn't so great.
Financial literacy is essential and important. It can help you make informed decisions regarding the allocation of your money and investment choices. It also helps us manage our finances in a better way.
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