Personal Finance - Three Simple Steps to Improve Your Financial Literacy

Many people today place money with financial analysts, fund managers and experts in the hope that they can grow their funds. However studies have shown that in the vast majority of cases, the individual generates the same return as the experts. But most people when confronted with this fact, usually reply that they do not know how best to invest their money themselves and it is submitted that the real reason is a lack of financial literacy.

So the usual question is how someone can increase his financial literacy? This article will therefore list three simple ways for anyone to start increasing their financial literacy.

Firstly, the best way to start is to start browsing an online investing dictionary and start learning simple financial jargon. A great place that you can consider is http://www.investopedia.com where you can start learning the meaning of basic financial terms so as to be better able to understand financial literature. You would want to spend some effort in learning those pertaining to the stock market first because such terms are most commonly used in the papers when financial analysts talk about the state of the economy.

Secondly, once you have a basic grasp of financial terms, you can then graduate on to reading the financial section of the newspapers. I know of friends who attack the movie section of the newspapers and maybe a little about the crime news but avoid the business section like the plague. These are the same people that gripe about the lack of understanding of the "recent increase in Initial Public Offerings". It can be a bit intimidating for the uninitiated but you will gradually start learning more about the particular market that you are in and how it works.

Thirdly, a fast way to learn more about financial terms is to make it a point to listen to the financial news daily before you head to work. This can be on the radio or on the television. Remember to take what the analysts say about stocks and shares in the news with a pinch of salt as sometimes the stock moves in response to what they say and as the scandals have proven, they sometimes actually move against the advice that they tell the general retail customers.

After doing these three simple steps daily, you will find that your financial knowledge will start increasing and you can then subscribe to Forbes and other financial magazines or newspapers like the Financial Times and feed your ever growing interest in financial matters. If you finally reach the stage where you want to know more then you might consider doing a MBA or CFA.

In conclusion, the quest for knowledge in the financial arena is a never ending one. New financial instruments are created ever so often and keeping abreast of such changes can be an almost impossible task. But getting started is ever so important in this fast moving world and you can then manage your own investments better and with more confidence.

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