What’s your style of learning?

Me, I’m a verbal learner. I love words. I love lectures.

The way I learn works well when I’m reading a book on personal finance or attending an investment seminar.

But what if your learning style is visual?

A visual learner absorbs information better if there are pictures, graphs, charts or diagrams. You probably get lost pretty quickly in the dense terminology of money management.

It’s particularly helpful to know your learning style when it comes to personal finance, because so much of it can give you a headache. It’s complicated.


GoBankingRates.com conducted a survey earlier this year to test people’s knowledge of financial terms and concepts. Survey participants were quizzed on how to determine one’s net worth, how a 401(k) works, and what terms like “CD” and “HELOC” stand for.

The site also posted an amusing video titled “Do You Know Your Money?” which showed young adults struggling to answer basic financial questions.

Here are some examples of what they said:

Q: What does the “S&P” stand for?

A: “Spending and payment,” one young woman answered.

Q: At what age can you start collecting Social Security?


A: “Is 34 an option?” one guy replied.

Their answers were comical and yet a little worrisome, because not knowing this stuff can lead to bad financial decisions that cost you real money. And, that’s not cute or funny.

For example, the GoBankingRates survey found that almost 40 percent of respondents couldn’t describe a 401(k), with some thinking it was a tax credit for retirement. At least they were in the ballpark. It’s an important savings vehicle for retirement – and not enough people are investing enough money in these accounts.

Most respondents 45 and older answered correctly that a CD is a certificate of deposit, but only 36 percent of 18- to 24-year-olds got the question right.

Net worth stumped a lot of people. Only 59 percent of folks knew it’s the value of what you own minus what you owe. A lot of respondents thought it was income after taxes.

Your net worth is a good barometer of how you’re doing financially overall. When I meet with folks to go over their finances, it’s the first thing we do. Because people incorrectly think their income tells the story of how well they’re doing.


Twenty-two percent of respondents thought a HELOC – or home equity line of credit – was a made-up term. It’s a real way to borrow money.

I spend a lot of time with financial literacy advocates, and we’re always debating why some people score so poorly on these types of tests. I think it’s because often the way personal finance is taught is too technical. It’s too dense.

If we want people to be better informed, we have to meet them where they are and tailor teaching techniques to best fit various learning styles. For the visual learners, for example, we’ve got to create material that’s visually engaging.

If this is your style, then you’ll like my choice for this month’s Color of Money Book Club. It’s “The Infographic Guide to Personal Finance” ($16.99, Adams Media) by Michele Cagan and Elisabeth Lariviere.

Cagan is a certified public accountant (the money person) and Lariviere is an artist and designer.

Throughout this reference guide are bold, colorful illustrations covering budgeting, saving, spending, debt, credit, investing and housing.


Not sure how a budget works?

Apply the 50-30-20 rule, Cagan suggests, using buckets to illustrate the point. In one bucket are your “needs,” which make up 50 percent of your expenses. These necessities include such things as housing, food and medical costs.

In the “wants” bucket, which accounts for 30 percent, you have clothing, vacations, eating out and entertainment.

The remaining 20 percent pail is earmarked for your emergency fund, retirement savings and extra debt payments.

Confused by how to calculate your net worth? The book’s graphic of assets and liabilities makes it easy to understand.

“Smart money strategies – like paying down debt and saving for retirement – send your net worth higher and beef up your financial fitness. Imprudent moves, like shopping sprees and ballooning credit card debt, can put your net worth on life support,” Cagan writes.


If you’re looking for a way to introduce financial concepts to a young adult, this book will do the trick. It doesn’t patronize them, it simply delivers a tough topic in graphically appealing, digestible bites.

I’m hosting an online discussion about “The Infographic Guide to Personal Finance” at noon on Jan. 4 at washingtonpost.com/discussions. Cagan will join me to answer your personal-finance questions. All types of learners are welcome!

Michelle Singletary is a columnist for The Washington Post. Readers may write her at:


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