Financial literacy can be a sore subject for many Australians. While keeping track of capital and having a handle on the ins-and-outs of personal or business accounts is good practice, it may fall down the list of priorities if tasks start to pile up.
You need to understand risk if you are going to manage your superannuation investments.
It's easy to put it off for another time, but failing to gain financial literacy can actually be incredibly detrimental in the long-term. Research from the University of Sydney Business School found that many Australians are at risk of making bad decisions in important areas, such as superannuation investments, because of a lack of financial knowledge.
"If you are going to manage your credit card, you need to understand interest rates or you need to understand how inflation might affect the spending power of your wages, and you need to understand risk if you are going to manage your superannuation investments," explained Professor Susan Thorp with the University of Sydney Business School.
Consequently, those that aren't ready and able to better deal with financial issues today will likely face tougher decisions further down the line.
"What we see is that people who have poor skills in this area are much less likely to have prepared for their retirement. They are likely to have found these decisions difficult and alienating and they don't want to think about it," Professor Thorp surmised.
The thought of correcting any knowledge gaps when it comes to financial literacy may be a daunting one, but here are a few things to keep in mind:
Watch and learn
There is a whole host of financially-focussed resources out there that are easy to access and provide a rich tapestry of information. Whether it's videos on YouTube or even just checking in to financial news websites now and again, such as Forbes or Australian Business Insider, regularly engaging with the right kind of content can be an easy first step.
Build a plan
If it's getting to grips with the aforementioned superannuation or just making sure that credit limits are present and correct on any applicable accounts, setting out a distinct set of goals can help plug any knowledge gaps.
Furthermore, try and picture everything along a defined timeline. This way, correcting financial savviness is unlikely to be pushed down any list of priorities.
Get an expert opinion
Even after hours worth of media has been consumed and a wider background knowledge base built up, there can be little substitute for getting a professional opinion.
At WMC Accounting, we can help you build better financial literacy, while also taking care of the heavy lifting to ensure that your monetary position is a stable one. We have the experience and enthusiasm to cater to all and are ready and willing to help both individuals and enterprises along the path to better wealth management. Click here to contact us now.