4 ways to boost your financial literacy and feel more confident managing money

According to a survey of 10,000 people by the Richmond Project, which claims to be the “largest numeracy attitudes study ever conducted in the UK”, nearly 40% of British adults have poor financial literacy.

The UK lags behind other developed economies, such as the US, Canada, Australia, Germany and the Netherlands.

Without a good understanding of financial matters, you might lack the confidence to take control of your wealth, making it harder to achieve your goals.

Fortunately, there are plenty of simple steps you can take to boost your financial literacy and improve how you manage your money. Here are four practical things you might like to try.

1. Get a clear overview of your finances

If you feel uncertain about how to manage your money, you might avoid looking too closely at your finances. This could make your money worries feel bigger and more overwhelming than they are.

In contrast, getting a clear picture of your current financial position could help you:

• Identify problems early
• Make informed decisions
• Replace uncertainty with numbers, reducing anxiety and stress
• Spot opportunities to cut unnecessary expense, grow your wealth and reduce debt

Start by listing what you have coming in and going out each month, your assets and your liabilities. This may include your:

• Income
• Essential expenses
• Savings
• Pensions
• Debts
• Investments
• Financial protection

Your financial planner can use this information to provide a visual overview of your current finances and how they could change over time. They can also highlight any potential issues or opportunities that you might have overlooked.

2. Create a budget that supports your goals

Once you know where you stand financially, set realistic goals and create a budget that will help you achieve them. This could help you:

• Identify and address unhelpful financial behaviours
• Cope with unexpected financial shocks
• Feel in control of your wealth
• Remove guilt from spending

You might find it helpful to categorise your spending into different buckets, for example, ‘essentials’, ‘lifestyle’ and ‘financial goals’. Remember to include a buffer for unexpected expenses; budgeting is most effective when it’s flexible and realistic.

Review your budget quarterly, or if your circumstances change; events such as receiving a pay rise or taking on a larger mortgage could significantly change how much disposable income you have.

3. Educate yourself

Boosting your financial knowledge doesn’t have to mean wading through technical books or trying to become an investment expert. There are plenty of accessible ways to learn.

Focus on understanding key concepts – such as inflation and compounding – and topics that matter to you. For example, if you’re approaching retirement, you might want to explore options for turning your pensions, savings and investments into a sustainable, tax-efficient income.

Here are a few ideas for getting started:

• Watch short educational videos, such as those available in our investment hub on the website
• Research information from trusted organisations, such as uk, the Money & Pensions Service and so on
• Listen to money management podcasts at home or on the go
• Read personal finance books from reputable authors

Learning little and often could allow you to improve your knowledge over time without feeling overwhelmed. Your financial planner can also play an important coaching role by explaining complex concepts in jargon-free language, supporting you to develop skills such as budgeting and steering you away from self-limiting beliefs (‘I’m bad with money’, ‘I don’t have a head for numbers’ and so on).

4. Schedule regular check-ins with your financial planner

The most effective and efficient way to build the financial knowledge you need is to combine self-education and personalised guidance.

Scheduling regular reviews and checking in with your financial planner around major life changes could boost your financial literacy and confidence by ensuring you:

• Understand your current position
• Set realistic goals and priorities
• Review and update your financial plan to keep it relevant
• Feel able to make informed decisions between reviews

Financial advice isn’t just about offering technical guidance; we’re also here to provide reassurance, accountability and education.

Please note

This article is for general information only and does not constitute advice. The information is aimed at individuals only.

All information is correct at the time of writing and is subject to change in the future.

Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

The Financial Conduct Authority does not regulate cashflow planning.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.