Break the Stigma: It’s Not Too Late to Start Learning About Money

Though sooner is better than later when it comes to learning about money, it’s never too late to start figuring out ways to improve your financial future. 

To help get some perspective, a 2022 study led by researcher Rafal Chomik, published in The Wall Street Journal, found that financial literacy peaks at age 54 and then declines. The study gauged financial literacy with questions about inflation, interest rates, and diversification.

In the study, Chomik found that people can and do make good financial decisions in their 20s and 40s—a huge age range. Chomik noted that the main difference between those in their 50s and those in their 20s is that 50-year-olds have more crystallized intelligence, while those in their 20s have more fluid intelligence. This means that those in their 20s are better at absorbing and processing new information but lack the accumulation of facts and knowledge (The Wall Street Journal, 2023).

This demonstrates that there are many people, ages 18-40 and even individuals in their 50s, who are making significant strides simultaneously in their financial wellness journey. It reflects that financial literacy is a lifelong journey, not a test that is passed at age 20 and later forgotten.

The Age-Old Stigma Around Financial Literacy

Too many people feel embarrassed about their finances and/or their financial knowledge: “I’m thirty; why don’t I own a home yet?” “If I haven't found my career field by now, it's too late.” “How can I be in my 40s and not have a retirement plan?” Much of that embarrassment stems from expectations predetermined by a society of ever-changing values. 

This isn't meant to downplay the importance of learning and applying financial concepts early on. That is important! But you should also feel assured that it’s never too late to start that journey and take proactive steps toward becoming financially literate.

A single mom in her thirties will have an entirely different perspective on finances than an adult day trader whose only dependent is a floofball named Sam—a floofball we'd all love, no doubt. These two individuals have different perspectives because their situations are vastly different: one likely discusses finances daily with fellow traders, while the other might avoid the topic in social gatherings out of fear of being judged.

These examples aren’t to say that either of these individuals are in the wrong. No, actually quite the opposite. No one is bad at finances, some just lack the opportunity to talk, strategize, and plan without the dreaded stigma of success hanging over them.

If there’s one thing we should all agree on, it’s that finances should be a topic in our everyday lives. There shouldn’t be this fear to bring them up or a judgment towards someone because of their lack of experience or knowledge–we’re all learning and figuring everything out!

Financial Literacy Is Important at Any Age

If I were to tell you that a 20-year-old’s financial journey looks entirely different now than it did thirty years ago, would you believe me? If we’re being honest, some concepts have been entirely altered with the evolution of the digital age. And that’s the point. As much as the earth evolves, the economy is not stagnant. Nor should our learning of it be. Everyone benefits from differently tiered financial concepts–budgeting, managing debt, investment strategies, etc.—and no one is ever truly alone in their learning.  A firm understanding of money can empower individuals, regardless of age or background.

Practical Steps to Begin Your Financial Literacy Journey

When you set aside age and societal expectations, are you where you want to be? If the answer is no, that’s okay. Make the changes you want to make, one step at a time. Don’t treat budgeting and saving like a chore, treat it like a hobby. Step back and say, “What happens if I save ten dollars every paycheck until I have enough to buy those headphones I’ve been looking at?” Start small, then work your way up.

Take time to get an overview of your finances. Lots of resources out there can help you with this, but if you’d like a fun, easy way to do so, check out the Banzai Financial Wellness Assessment. It’s fast and provides an easy way to get a good overview of your finances so you can know where to start making impactful changes in your financial journey.

There’s no one-size-fits-all goal, this is a what-do-you-want-out-of-life-right-now sort of plan. If you want to start paying off or better managing debt, do that. But remember, it's wise to take it slow to avoid falling back into a cycle of negativity. Start by making a conscious effort to reduce your credit usage. Once you've achieved that, focus on putting as much as you can toward paying down your debt. And don't forget—celebrate your wins! Even if it's something small, like not using your credit card for a full month (or whatever goal you've set for yourself), make sure to celebrate it.

Remember, according to a Bankrate Study "nearly 6 in 10 (59 percent) U.S. adults are uncomfortable with their level of emergency savings." You are not alone in your goal to do better. The average American is right there with you.

Make your finances a game. Turn them into a hobby. Enjoy the financial journey, no matter where you feel 'stuck' in life. (No one is ever truly stuck, even if it feels that way.) Start where you are and build from there.

Source:
Chomik, R. (2023, August 25). The exact age when you make your best financial decisions. The Wall Street Journal. Retrieved from https://www.wsj.com/personal-finance/the-exact-age-when-you-make-your-best-financial-decisions-2a8163bb