Why financial literacy isn't really that elusive

By Justin Boyle

When I was younger, I tried to think about money as little as possible. I just put my paychecks straight into my checking account, lived modestly and managed to stay above water for the most part. My personal finance strategy was to look the other way while my money came and went, hoping through arcane guesswork that I wouldn't overdraft my account with the next rent check.

I slipped up more than once, naturally. It wasn't until after college that I decided to sit down and transform my unsteady cash flow into concrete figures, and even then it took me almost a week to get over my fear of fiscal reality. Once I did it, though, things started to make more sense, and the practice of earning, saving and spending money began to create less stress in my life than it had when I was treating it like some force of nature that could never be understood.

Statistics show that a disturbingly large percentage of Americans suffer from that same financial fear that kept me from examining my situation for so many years. In fact, a 2012 survey commissioned by the National Foundation for Credit Counseling indicated that more than half of U.S. adults have no budget, and a full third of them neglect to pay their bills on time.

Although economists tell us that we've weathered the worst of the recent financial crisis, the financial literacy crisis seems be going strong. But here's how you can be part of the solution.

Why financial literacy matters

It may go without saying, but financially illiterate people can still earn and spend money without any obvious trouble. Financial literacy isn't so much the science of earning and spending as it is a way to understand and think critically about money and the rules that govern it.

Take a credit card application, for example. If you're financially literate, you'll read through the terms of the agreement and make note of the APR, introductory period, annual fees, cash back rewards and any other information relevant to its use. If you're not financially literate, you might just fill it out, send it in, rack up a balance and start forking over minimum monthly payments (on time, with any luck) without giving a thought to the cost of credit or the potential drag that card may have on your overall cash flow.

Here's one way to sum it up: Financially literacy can help a little more of every dollar you earn stay in your own pocket. Luckily for all of us who wouldn't mind keeping more of what we earn, the path to financial literacy is hidden in plain sight.

How to become financially literate

Fundamentally, all it really takes to develop financial literacy is the right information and a willingness to learn from it. Self-starters can take it upon themselves to process the information into effective conclusions, and that method works just fine for many of us, but you can also find several organizations whose mission it is to help guide you into a world of wiser financial decisions.

But what if it's not just money that scares you? What if you're one of the unlucky few who just can't seem to wrap our heads around numbers and how they work together? What if you're less finance-averse than you are math-averse?

Well, with the recent rise of massive open online courses (MOOCs) -- Web-based courses offered for free by universities across the country -- groups like the Carnegie Foundation and the Bill and Melinda Gates Foundation are working with universities to help solve that peculiar number-numbness that afflicts so many of us. An Australian university even offered a financial literacy MOOC to students worldwide in fall 2013. The options are there, as long as you have a few minutes to spend with a search engine.

Look at it this way: While it's up to you whether financial literacy is worth your effort, it is likely to help every dollar you earn go a little further. So take a look at some of the resources available and see if you can afford the time to invest in your financial future.