Personal Finance Tips and Tricks

- Everyone loves to talk about financial literacy for kids, But what about for adults? Money isn't something that we figure out just once, when we get our first job and apartment, and then we're done. Our complex financial tasks and evolving life circumstances require us to be lifelong learners when it comes to money. As a therapist who specializes in financial issues, I see this come up in some interesting ways. Many of us who claim to be bored or uninterested in money are underneath terribly anxious about it.

And when we're anxious, our ability to take in and process new information is compromised, if not taken entirely offline. When we're forced to make a financial decision in that state, we find it difficult to focus. We often choose impulsively, and are overly vulnerable to anyone giving, or selling their advice. To avoid this, I recommend that we focus on financial education in three ways. First, as a lifelong process, second as a subject of personal relevance as opposed to a problem to be solved, and third as an activity that relates to our preferred learning style.

Let me start with that last one first. Do you know your preferred learning style? There are five and most of us have one or two that are dominant, though we can usually use them pretty flexibly according to the situation. They are visual, verbal, aural, logical, and experiential or kinesthetic. So, if you're visual, you process best when information is colorful and graphic. Verbal learners take in words, both spoken and written. Aural learners are often very musical and able to hear and retain patterns of sounds.

If you're logical, you like to use reason, analysis, and cause and effect. And experiential learners learn by doing, especially if the activity results in a state of physical and mental flow. Within these types, people also have a preference for solitary versus social learning. Yet, when we try to take in new financial information, we don't usually ask ourselves if part if the difficulty is that we're trying to conform to an uncomfortable learning style. Instead of a book on personal finance, you might get the strongest benefit from a video or a class, a workshop or a podcast.

Aural learners could probably set a complex string of information into a song that they'd be able to sing years later. So, now that we've though about how we're learning, let's talk about what we're learning. Financial management falls into four general categories: Cash flow and budgeting, credit and debt, savings and investing, and financial planning for long-term goals. Each of these is a pretty broad category, and much of your self direction within it will be determined by where you are in life. You probably won't want to study up on mortgages, for example, until you're interested in buying a house.

You just want to make sure that you're covering each of these areas. So if you don't know much about saving and investing, that might be an area where you need to push yourself a bit. Set a specific learning goal, and anchor it to a particular time period. For example, taking at least two seminars each year, listening to a podcast every week, or reading one personal finance book each quarter, maybe even in a book club dedicated to money. Have fun with this. Expand your confidence and skills, and make money a source of positive growth, both personal and financial.