We all spend money, but how many of us really know how to properly manage our money? This skill – or the lack of it – is referred to as “financial literacy” in the same manner as “literacy” gauges how well a person can read. A lot of people might say they are not very literate when it comes to finances. Financial literacy is defined as the ability to understand how money works. But this simple definition has broad ramifications. For instance, how well do consumers resist temptation to spend more than they earn? Have they invested in themselves, their family or charities? To have an impressive amount of financial literacy, it seems best to do things that are not exciting, at least initially. Be frugal. Prepare. Track your spending. Legendary businessman Warren Buffett is considered a genius at investing, yet his approach is simple. “You only have to do a very few things right in your life so long as you don’t do too many things wrong,” he said. Buffett is a thrifty guy who always avoided debt and extravagant living and still resides in the home he bought in 1958. As he has done with his housing, he does with stock. He buys and keeps it.
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