If you’d like to boost your financial IQ, there are some simple, straightforward ways you can make yourself a smarter, savvier individual.
Get a Financial Education
What you’re doing right now—taking the time to read a money-management article – is one basic step to greater financial literacy.
You can also read personal finance magazines, or newspapers that can teach you about money management.
Another idea: take personal finance, investing or economics courses (even cheap ones at a community college or an adult education/continuing learning facility).
Get a Financial Mentor
It also pays to surround yourself with people who are doing better than you are financially. If you know people who are very well off financially, even better.
Ask them for strategies they’ve used. Find out what they did—and didn’t do—to achieve wealth.
Don’t be afraid to say flat out that you’re trying to turn your financial life around, and that you’re interested in discovering practical money-management strategies that work.
Get the Right Fiscal Mindset
Change your mindset from a purely consumer-driven mentality to one that is consumer savvy.
In other words, don’t just think about what you want or need to buy, think about the smartest ways to get what you need.
Do you really have to purchase those books from the bookstore? Or is it possible to borrow them from the library?
Should you buy those clothes right now—or wait until they go on sale?
Can those groceries you need from the supermarket be purchased less expensively if you simply clipped a few coupons?
The idea is to be conscious about your spending and financial habits. Don’t merely turn over your hard-earned dollars to the first open hand. Be wise about when, how, and with whom you’re spending your money.
Get Into the Habit of Comparing Prices
Finally, to raise your financial IQ, make comparison-shopping a normal and regular part of your life.
Any time you buy something, always think: where can I get it cheaper, or is there a way to decrease the cost of this purchase?
Let’s say you’re buying soda from the store. Instead of a 12-ounce can would it be better to buy a 2-liter bottle?
When you’re comparison-shopping, the Internet is a great equalizer because you can find tons of information online and quickly get a sense of whether a product or service you’re looking to buy is overpriced or a real bargain.
Even offline, be on the lookout for ways in which you can exercise your mind—building your financial IQ every step of the way.