Financial Literacy for Beginners: My Journey from Illiteracy to Independence

Did you know that only 50% of Americans are considered financially literate?

If you’ve been out of school for a while, 50% would be a solid F grade. Yikes!

This statistic isn’t a one-time fluke either. According to an annual study by the Global Financial Literacy Center, this average has held steady over eight years, from 2017 to 2024.

Globally, the picture doesn’t get better. A survey of 150,000 adults in over 140 countries determined that only 33% of adults are financially literate. So on the bright side, we suck less than the rest of the world!

USA! USA! USA!

We're still failing, though, guys.

But don't lose hope. My own journey proves that change is possible; I'm here to share how I went from financial illiteracy to independence and retired before 50.

WHY FINANCIAL ILLITERACY IS SO COMMON (IT'S NOT YOUR FAULT)

Unfortunately, our educational system isn’t set up to teach students any life skills involving money. Schools do not teach personal finance. They do not teach what a mortgage is and how to apply for one. Or how to build credit. Or how to invest.

Instead, schools only teach the skills that make us attractive to potential employers. As a bonus, they’ll throw in a generous handful of other skills most of us will never use—calculus and Latin, anyone? Learning to manage the money we earn and other basic life skills is left up to us to figure out.

In my 12+ years of working in Human Resources, I’ve seen many employees living paycheck to paycheck or in dire financial trouble. Often, it wasn’t simply due to low earnings. Rather, it was a combination of poor financial decisions and a lack of knowledge of such things as loans, debt, and budgeting.

A company I worked at had an emergency financial assistance program for employees. The program had its flaws, but it was compassionate. Anyone could submit an application.

A few employees would try to abuse the program, but the majority of requests for assistance were legit. Part of my job was to look through applications to ensure everything was in order before sending them to the review committee.

I remember checking the supporting financial documents of one employee's application and being shocked. Each document I flipped through painted a deeper and deeper financial hole. He wasn’t just behind on multiple payments. He had taken out high-interest payday loans to pay off bills, trading off debt for even higher debt.

I never found out if his application got approved. But even if he did receive financial assistance, I know it wouldn't have been even close to what he needed.

When it comes to personal finance, our schools never set us up for success. So, there's no shame if you were to grade your financial knowledge with an F today. I used to be as clueless as they come and still managed to retire before turning 50.

What’s important is that you understand your current status and acknowledge you need to do something about it. All of us have had a come-to-Jesus moment—or as I prefer to call it, the oh shit moment—when we realize a significant change in our lives is needed.

For me, that moment came while watching a show.

FINDING MY 'OH SHIT' MOMENT: THE PERSONAL FINANCE WAKE-UP CALL

“What do you do with a B.A. in English? What is my life going to be?” sang Princeton, a recent college graduate and the main character of "Avenue Q," the Tony Award-winning musical comedy.

The showroom erupted in laughter, and it was only the first minute of the opening act. I knew this show was going to be hilarious!

“Four years of college and plenty of knowledge have earned me this useless degree.”

So true, I thought, chuckling to myself. An English degree is useless. He’s screwed! But the laughter quickly became uncomfortable as I came to a sobering realization.

I have a B.A. in Japanese.

Surely, if there’s any degree more useless than English, it has to be mine. It felt like the rest of the audience was no longer laughing with me but at me. As I shrank in my seat, I reflected on my academic choices with more than a tinge of regret. I may have screwed myself over.

GRADUATING WITH NO FINANCIAL DIRECTION

You know that kid who meanders through school life with no real plan for the future? Well, that was me.

In my senior year of high school, while everyone was gleefully applying to universities and planning their postgraduate futures, I was still trying to figure out what life direction to take. I admired my classmates who seemingly had their lives figured out while feeling shame that I didn't.

Still, I wasn’t overly concerned with the distant future, though, just what was immediately in front of me: graduating. Although I had no plan, I naively believed things would just work out on their own. I tried to reassure myself that not everyone goes to college.

MY COLLEGE DEGREE FELT USELESS

I ended up enrolling as a Computer Science major, not because I was interested in the field. I didn’t even really know what the field was about. I just wanted something that sounded as impressive as the finance and engineering degrees my friends were pursuing. I didn’t want to be seen as the only person with no direction or long-term goals.

I thought I would figure things out once I started attending college, but the only thing I realized was that I had no talent or passion for computer science, which led me to change my major to Japanese.

I still had no plan, but the courses were easy, and I just needed to graduate with some sort of degree. Get a college degree, any degree, and you'll be able to land a job. This was the lie we were all told back then.

Surely, I will figure out my life by the time I graduate, I thought to myself. I have four years to find my direction. I was still hopeful everything would miraculously work out.

Flash forward several years to when I’m sitting in the showroom of "Avenue Q," and I am still clueless about my future. In the game of life, I was still stuck at the start line.

By this time, some of my former high school classmates who majored in finance or engineering were already making $50-60 thousand a year. Meanwhile, I was struggling to make a little more than $10 thousand. Even combined with my wife’s salary, we were lucky to break $30 thousand back then.

CAN BEGINNERS REALLY ACHIEVE FINANCIAL FREEDOM? (THE MILLION DOLLAR CALCULATION)

Around this time, my wife and I enrolled in a personal finance course offered through the local university’s educational outreach program.

As is common with such courses, there was too much to cover and not enough classes. There were no deep dives into topics. Instead, we got high-level overviews and printouts to take home. Back to figuring things out on our own again.

Instructions concentrated on what we should do, but severely lacked in detail on how to actually do it. It was frustrating. I already knew I should invest my money. What I needed was to be taught how and what to invest in. I remember coming out of this course with more questions than answers.

There was, however, one thing that the instructor said that stuck with me to this day:

Each of you will earn a million dollars in your lifetime. It’s up to you to hold onto as much of that as possible.

I quickly did some calculations. At a combined household income of $40 thousand—assuming we could get to that from our then-current $30 thousand—we would both have to work into our 80s. Yeah, right, I thought. Impossible.

Like most people, we had no real plan for retirement; our plan was to work until retirement age and then hope we had enough—the old tried and true wish-for-the-best approach.

But doing those calculations that day made me worried. The matter-of-fact manner in which the instructor spouted that $1 million figure made it sound like an easily achievable and expected norm. And we were way behind in the game.

Was there a chance we would never escape the rat race? Could we end up as one of those senior couples still working in their twilight years because they have to?

This was the first time I seriously thought about our financial future. A seed was planted in my head that maybe we needed to make some big changes. Maybe we needed to take control of our finances.

Still, I hadn’t fully bought into that idea just yet. Thinking about how to avoid a bleak future was stressful. It was uncomfortable to admit I should have planned better when I was in school. It was easier to bury my head in the sand and just think happy thoughts.

I clung onto hope that maybe, just maybe, things would still work out if we just made it to retirement age. After all, Grandma never went to college, and she managed to retire, living off of social security and modest savings.

Luckily, I was about to have another oh shit moment that finally set me on the right path. We weren't financially screwed yet but would be if we didn't make some serious changes. I'll share that moment in my next post.

Feel free to leave a comment below. If you've had an oh shit moment, what was it? Or if you graduated with a college degree that's even more useless than mine, I'd love to know.

See you at the finish line!

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Disclaimer: I’m not a licensed financial professional. This blog shares my personal experiences and opinions around money, investing, and early retirement. It’s for informational and educational purposes only—not financial, legal, or tax advice. Always do your own research or consult with a qualified professional before making any financial decisions.