During the COVID-19 pandemic, I had a financial wake-up call. My clinical work came to a sudden halt. Although I was fortunate to continue teaching, a significant portion of my income disappeared.
However, the bills did not stop. After 15 years of hustling, I found myself forced to pause, not just to manage the setback but to take a hard look at our financial situation.
Since I had plenty of time to reflect, I immersed myself in learning everything I could about personal finance. While I had spent years pursuing education and career growth, I realized I had never been taught the fundamentals of managing money. And I was not alone.
Financial literacy is not part of most school curricula, leaving many people to figure it out on their own and sometimes through costly mistakes. But the good news is that I believe anyone can take control of their financial future by learning a few key principles.
Financial literacy is not just about money. It is about freedom, security, and the peace of mind money can bring. If you can understand a few key principles, you can take control of your financial future and avoid common mistakes that keep people stuck.
Why Learn About Money
I am convinced that improving financial literacy is one of the most effective ways to reduce burnout and improve well-being. Think about how much money impacts every part of our life. Yet, many people are never taught how to efficiently manage it.
Having a strong financial plan can provide clarity, reduce stress, and allow you to focus on meaningful work instead of constant financial concerns.
I think one of the biggest mindset shifts is understanding that money should be utilized as a tool and not the ultimate goal. Money can unlock opportunities, flexibility and stability in your life when used wisely.
Gaining control over your finances can help you buy back time, which is one of the most valuable assets we have. Furthermore, improving financial literacy can help you build a life of greater fulfilment, purpose, and impact.
Common Financial Traps
Here are some common financial mistakes people make when they don’t understand money and a couple of simple solutions.
#1. Living Above Your Means
Problem:
Lifestyle creep and spending more than you earn.
Solution:
Engage in what I call “conscious spending”. Track you expenses for at least a month to see where your money goes and assess your financial habits. You can use this information to consider a simple monthly budget but also beware of impulsive purchases.
#2. Ignoring Savings and Investments
Problem:
Not saving enough or delaying investing because you think it’s complicated.
Solution:
Pay yourself first by setting up automatic transfers to savings. Start investing early, even with small amounts, using index funds or retirement accounts like a Roth IRA. The earlier you start, the more time your money has to grow.
#3. Misusing Debt
Problem:
Credit cards and loans are easy to access but can quickly become a burden if not used wisely.
Solution:
Recognize good vs. bad debt. Credit cards should be used for convenience with balances kept low and paying more than the minimum.
Simple Strategies to Start Improving Financial Literacy Today
It can be difficult not knowing how to improve your financial knowledge. Here are a few actionable steps with the beginner in mind to empower your financial journey.
Your Future Awaits
Financial literacy is about making informed decisions that align with your values and long-term goals. Taking small and intentional steps today can lead to greater financial stability and flexibility in the future.
I believe that improving your financial knowledge can reduce stress, create new opportunities, and allow you greater freedom to focus on what is important to you.
The journey to financial freedom begins with one small step. You can start by setting a small goal, tracking your spending or exploring a new personal finance resource.
Building consistent progress over time will allow you to construct a more secure and impactful life.
What is one financial step you can take this week to move closer to your goals?
Taking control of your finances is a powerful step toward creating a life of greater security, freedom, and meaningful impact.
“Financial freedom is available to those who learn about it and work for it.”
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Shaun Lynch is the founder of Impacting Education, an online personal development company dedicated to empowering individuals to lead lives of purpose, fulfillment, and impact. Dr. Lynch combines his expertise in healthcare and education to inspire positive, lasting change through his writing and teaching.