Ways To Educate Yourself about Personal Finance and Money

by RC on May 20, 2008

One of the keys to improving your personal financial situation is educating yourself. The more you learn and know about debt reduction, money management, investing, retirement options, and building wealth, the more likely you are to achieve your personal finance goals, whatever they may be. There are a multitude of venues you can rely on to learn more about money management, investing, and debt reduction, and other money related topics. Here are some of the “main categories”, and some specific examples of each.

Printed Material

Books- I have always been a big fan of reading, so books are still one of my favorite sources of financial information. Whether the topic is debt reduction, investing, frugality, or any other facet of personal finance, there is likely a good book dealing with the subject. A few of the more popular titles regarding personal finance and investing include the following:
The Total Money Makeover by Dave Ramsey-Debt Reduction
Your Money or Your Life- Debt Reduction/Money Management
The Millionaire Next Door-Becoming Wealthy

One of the most prolific sites for personal finance book reviews is the Simple Dollar, and Trent’s 52 Books, 52 Weeks, A Buyer’s Guide is a great place to get an overview of many of the most popular personal finance books available today, or check out his book review category for even more.

Newspapers- While you may think that the newspaper is a dying media, but you can still learn a lot by reading the Money or Business section of your local newspaper every day. Financial papers such as the Wall Street Journal, or the New York Times money section can be great for improving your financial knowledge as well. Instead of paying for a subscription to these newspapers, check out your local library or ask a friend or relative who gets the paper if you can have their old copies.
Magazines-There are a great number of personal finance and money magazines available, which you can read at your local library, borrow from your friends or family, or subscribe to, usually for a reasonable fee compare to the newsstand price. Some of the more popular magazines are Smart Money, Money Magazine, Kiplinger’s, and Consumer Reports , which are all great magazines for educating yourself and making smart choices with your money.

Audio

I had listed a few radio and podcast sources, but J.D. at Get Rich Slowly recently posted a great resource article on Twelve Top Personal Finance Podcasts, which covers most of the PF podcast available. Check your local radio stations as well for money or finance related radio shows as well.

Internet

-There is a plethora of financial information available on the internet, both commercial sources as well as personal websites or blogs. You should always use any financial advice, such as investing with caution, of course, but there is really a great deal of good information available on the internet.

Yahoo Finance- One of the better sites for up to date news and financial information.

MSN Money Community-Contains news, blogs, and articles on saving and spending money as well as many other personal finance topics, such as frugality and investing.

PFBlogs.org- A great personal finance aggregation site, with over 1000 personal finance, investing, and real estate sites aggregated.

People

-Talking to other people about money related issues and topics can be a great way to discover what others are doing in a situation similar to yours, or how people invest, spend, save for retirement, etc. While you shouldn’t try to “keep up with the Joneses”, you don’t have to get into specifics about someone’s income to discuss spending and saving money, either. These days, just about everyone is willing to talk about the economy and topics such as how to combat rising gas or food prices. Now of course, you should always take any financial advice such as the the latest “hot stock tip” with a grain of salt, but discussing money topics with others can be a great way to learn how others manage their finances. Finding a professional financial adviser can help you with details of your personal finances as well.

What do you do with all of this new financial information?

Ask Questions- Ask questions of your friends and co-workers, and don’t be afraid to ask a blogger, a writer or a radio show host questions.

Perform Your Own Research-As with any advice, you are always well advised to do your own research to confirm or verify what you have read or heard. Dig deeper into the topic until you are satisfied with the results. After all, it’s your money.

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{ 3 comments… read them below or add one }

Curt May 26, 2008 at 5:49 pm

This is a great post – but I was just thinking, what is the value of researching and learning about financial matters?

Sure, it’s assumed people that spend time learning about money are more likely to achieve their financial goals, but prove it. I want to know how much it benefits me to spend each hour educating myself. How much per hour is it worth to education myself about financial matters?

Here is my estimate: If I spend 5 hours per week reading and learning about financial matters and I am gaining 5k per year more then the average person, then my investment is worth, 5K / ( 5housr x 52weeks = 260hours ) = $19 per hour. I’m not sure about this calculation, I may have missed something, but time is an investment and the value of time needs to be thought about before it is invested.

What do you think? How would you calculate educating yourself?

Reply

RC May 27, 2008 at 10:52 pm

@Curt

I think you bring up a good point to consider. There are several ways to look at it,
and likely a whole range of benefits for the time, depending on the existing
knowledge one may or may not already have. If someone has very little knowledge of the importance of debt reduction, personal finances,or the basics retirement savings, the returns can be huge. For example,if someone has no knowledge of retirement investment vehicles and actual learns about a Roth IRA, starts investing in one, that short period of time could be worth tens of thousands of dollars. On the other end of the spectrum,a skilled investor may spend many hours researching mutual funds or ETF’s, and only see a small gain, if any, from all that reading. If he were to choose similar performing ETF’s with a lower expense ratio, for example, the increase in the yield of the fund could be calculated and divided by the number of hours spent performing the research.
I do think that most people would fall somewhere in between.
I also think that the benefits of changing one’s mindset, such going from a life racked with high interest credit card debt to living debt free, and focusing on building wealth and saving for retirement, the benefits could be very large as well.

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Lacey September 30, 2008 at 5:23 pm

This was a great post! There is so much turbulence in the market today, and people need peace of mind more than ever. I wanted to offer your readers a link to another blogger who is doing great work. He writes about our ‘childhood money messages’ and how the best approach to stability in today’s market is to resist letting these emotions control our buying/selling habits. It is really fascinating work, and something you should all check out. His name is Spencer Sherman, and you can view his blog at http://www.curemoneymadness.com/blog.

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