Over the past two decades, health literacy research has gained increasing attention in global health initiatives to reduce health disparities. While it is well-documented that health literacy is associated with health outcomes, most findings are generated from cross-sectional data. Along with the increasing importance of health literacy in policy, there is a lack of specificity and transparency about how to improve health literacy in practice. In this study, we are calling for a shift of current research paradigms from judging health literacy levels towards observing how health literacy skills are developed over the life course and practised in the real world. This includes using a life-course approach, integrating the rationale of precision public health, applying open science practice, and promoting actionable knowledge translation strategies. We show how a greater appreciation for these paradigms promises to advance health literacy research and practice towards an equitable, precise, transparent, and actionable vision.