• Revenue Cycle Management
  • COVID-19
  • Reimbursement
  • Diabetes Awareness Month
  • Risk Management
  • Patient Retention
  • Staffing
  • Medical Economics® 100th Anniversary
  • Coding and documentation
  • Business of Endocrinology
  • Telehealth
  • Physicians Financial News
  • Cybersecurity
  • Cardiovascular Clinical Consult
  • Locum Tenens, brought to you by LocumLife®
  • Weight Management
  • Business of Women's Health
  • Practice Efficiency
  • Finance and Wealth
  • EHRs
  • Remote Patient Monitoring
  • Sponsored Webinars
  • Medical Technology
  • Billing and collections
  • Acute Pain Management
  • Exclusive Content
  • Value-based Care
  • Business of Pediatrics
  • Concierge Medicine 2.0 by Castle Connolly Private Health Partners
  • Practice Growth
  • Concierge Medicine
  • Business of Cardiology
  • Implementing the Topcon Ocular Telehealth Platform
  • Malpractice
  • Influenza
  • Sexual Health
  • Chronic Conditions
  • Technology
  • Legal and Policy
  • Money
  • Opinion
  • Vaccines
  • Practice Management
  • Patient Relations
  • Careers

How We Become Financially Literate


Financial literacy is having the skills and knowledge to effectively manage your financial affairs. Unfortunately, one way most people learn about money matters is by painful experience and trial and error.

Financial literacy is having the skills and knowledge to effectively manage your financial affairs. Yet, I recall seeing a survey that showed that people would rather go to the dentist than make a financial decision. So, denial notwithstanding, we are all in obvious need of learning these basic skills.

But, other than reading PMD, how do we get these skills and information? The reasons for why we need them are obvious, and if they don't seem so to someone, then, inevitably, their necessity becomes needlessly painful lessons. Basically, financial literacy boils down to: what is money, how do we get it and what do we do with it? Ah, it's in the details, the details....

One way that most of us learn about money matters is by painful experience, trial and error. And we try not to overreact. We all know at least one of those poor souls who have allowed negative emotions, like cynicism from bad experience(s), to get in the way of the rational management of their money thereby adversely affecting the rest of their lives as well. For let us never forget that money is only a tool to help us do what we want, and need, to do in our lives. Money by itself is a measure of worth, a means of exchange and a store of value. An inherently emotionless tool, not an end in itself, as we unfortunately so often see.

Our first exposure to money matters is by observation of what our families do and value with money matters. We get almost no formal education in it at any level of our schooling, although awareness is increasing that this is a very expensive oversight. Some experts have claimed that the general public's lack of financial literacy was a major factor in the recent debt recession.

There are a number of foundations pushing the financial literacy education issue, and even the government has an "Office of Financial Education" in the Treasury Department, at mymoney.gov. I confess my own previous ignorance of such a resource, even though I have done this sort of thing for a long time.

As life will have it, much of our financial educations come by chance, if only in the timing. I will never forget how surprised I was when I was confronted with the fact that I would have to learn how, and then file an income tax form for my (measly) intern salary. My previous summer jobs were under the radar and were ignored by all concerned, I realized.

So observation, trial and error, chance and expediency are the common experiences of learning money affairs that we all share. Some of us will learn or be advised or forced to seek professional help, often as a stepping stone in our own financial educations. We reinvent the wheel ourselves at our peril, we sometimes learn after the fact.

What we learn about money, basically, is threefold. First, we learn to delay gratification. We learn about the absolute need to save, to be patient, and let the miracle of compound interest lead to our financial security. Next, we learn, usually the hard way, to take as much emotion out of our decision making as possible. Lastly, we learn the all-important details, the jargon, the laws, the specific means and how we have to remain vigilant to change if we are to flourish.

There is a famous story told about a rabbi, who when asked about the reason for Bible study, replied, "It is all about 'do unto others as they would do unto you.'" So if it’s that simple, why should we study? "It's all in the details, so go study."

In the Bible, in medicine, in money matters, it's always about the details, "so go study."

Related Videos
Victor J. Dzau, MD, gives expert advice
Victor J. Dzau, MD, gives expert advice