Factor income, adhocracy, codicil, disintermediation, high current income mutual fund. Is your head already spinning? You’re not alone. There’s a lot to keep up with in the financial world—whether you work in it or you’re just trying to manage your day-to-day budget and work toward your first investment. To make matters worse, it seems like financial rules, markets, and financial success strategies are in a constant state of change.
But despite all of the financial jargon and intimidating financial journals, being financially savvy is actually easier than you think. And it’s pretty important, too. In order to make positive investments and maintain financial stability, you’ll (at the very least) want to establish foundational finance knowledge to help you navigate the landscape. Understanding when to invest, how to budget, and what on earth your financial advisor is talking about areimportant steps toward a better financial future. Here are some tips to help you boost your knowledge in finance so you can talk the talk and walk the walk.
Know the terminology
Yes, you will need to memorize a few key terms to help you get a better understanding of how finances work and how these inflated terms apply to your own finances. Use a financial dictionary daily to clue yourself into new words and help you make sense of those that you read or hear when talking to a finance professional. This will boost your confidence when you’re talking about your own finances and even inspire you to take new steps to improve your financial health.
Not sure where to start? Here are a few top finance terms to put on your radar.
- Assets: Property owned by a person or company, regarded as having monetary value.
- Fixed interest: When the interest rate on a credit card, mortgage, or other loan type does not change.
- Variable interest: When the interest rate on a loan payment does change.
- Net worth: The difference between what you owe and what you own.
Stay up to date on finance news
One of the best ways to educate yourself on finance terminology and changes in the industry is to follow a variety of finance blogs and reports. While this might seem like a big commitment due to the overabundance of resources out there, you can narrow down your focus to help you prioritize topics that mean the most to you, or those that impact you the most.
Interested in tax issues? Follow a tax reform news publication to stay on track with tax changes that might affect how you file or how much you can expect to pay in taxes. Our current political climate has placed a lot of buzz around this topic, and who knows when policies may change again, so it’s best to stay ahead of the curve so you know exactly what to expect preceding tax season.
Or perhaps you’re interested in investing and want to keep tabs on the evolving market to protect your investments. Use an investment app such as Stockpile to help you manage your investments and give you insight on the stock market.
Invest in finance tools that help
You don’t have to embark on your financial journey alone. The best way to learn how to properly manage your finances is through the hands-on approach. Thanks to the digital age, it’s easier than ever to track your own financial data, tailor your budget, make investments, manage debt and look for opportunities to improve your financial profile.
Here are a few apps that you may want to check out to help you learn more about your own finances:
- You Need a Budget (YNAB)
Practice makes perfect
Personal finance management skills simply don’t materialize overnight, though we wish it were that easy. It takes time to learn how to balance your budget, make smart investments, and how to strategize your savings plan. The best way to get all of this experience is to practice on your own. Make it a habit to check your bank accounts daily, evaluate the progress of your budget plan, and strategize to enhance your savings.
You don’t have to go to accounting school to be financially savvy. Use these tips to help you learn how to better manage your finances and work toward a better financial future.