Mind Over Money (3rd in a Series)

Article

STEP 3: Get educated.

"A lot of times women think they are supposed to know through some kind of osmosis what they should do with their money," says Gail MarksJarvis, financial columnist for the Chicago Tribune and author of Saving for Retirement Without Living Like a Pauper or Winning the Lottery. "I find that really laughable. The reason we know how to cross the street without getting hit by a car is because at some point when we were young, someone told us that a green light means go and a red light means stop."

Most of us never got that kind of financial coaching. As my friend Emily puts it, "I realized at a certain point that I had never learned a lot of fundamentals: what a money market account is, when it makes sense to have savings bonds, those kinds of things." Indeed, they teach geometry in high school (for all those occasions when you need to figure out the area under a bridge) but not basic financial management. So you have to study it on your own.

My favorite part of this quote is probably the part of figuring the area under a bridge. It's so true. There was no financial education in my high school, and it wasn't part of my college's curriculum. I was fortunate that I did take an elective "Intro to Business" course in high school where part of the class was entering data into a checkbook register, so I knew how to handle that. But that was it. Before I started my present job, I didn't even know what a 401(k) was, though I worked at a job prior to my current one that probably should have asked me if I wanted to enroll in its plan.

The article suggests some good ways to increase your financial knowledge. The only thing I would add is this- share your knowledge with your kids, grandkids, nieces, nephews, etc. It's a great gift to give them.

Suggested Reads

Books
Women & Money- a great financial guide for both genders
The Millionaire Next Door & The Millionaire Women Next Door- both challenge lots of preconceptions about the rich
Nudge- Interesting info on how people respond to financial choices depending on how the decisions are framed

Magazines
Money- my favorite financial magazine
Smart Money- my mom's favorite
Kiplinger's Personal Finance- another good choice