“Though we are literate of the 21st century, still we are illiterate when it comes to financial literacy. Financial literacy is the only way to enjoy breathing the fresh air to become financially independent. You have to adopt the below action tips to become financial independence in your life.”― EBINEZAR GNANASEKARAN
Financial literacy is a big deal, and lack of this foundational skill can be a huge problem in life. It’s such a big deal that April is International Financial Literacy month!
You may be wondering, what is financial literacy, anyway?
Financial literacy, as defined by the Financial Literacy and Education Commission, notes it as “the skills, knowledge and tools that equip people to make individual financial decisions and actions to meet their goals.” It’s daily money management to make smart daily choices (large latte vs small light roast). Also, it comprises larger concepts like interest rates, debt to income ratio, and net worth. In short, to be financially literate is to know how to manage your money. This means learning how to pay your bills, borrow save money responsibly, and how and why to invest plus plan for retirement.
The sad truth is that this isn’t often taught in schools, which means that folks are left to learn it on their own. The idea of financial education became well-established, only under different names—home economics, household finances, family finances, or consumer economics. Unfortunately now, those courses are mostly defunct in schools.
“Financial education is more valuable than money”
― Mac Duke The Strategist
Don’t believe me?
The Stats are in and says it all, read on…..
17% of Americans approaching retirement have no retirement savings and 42% of Young Americans aren’t saving. The earlier you start the more you can save. Financial literacy means you will be able to understand why and how you can save for your future.
Lack of financial literacy is a gendered issue, as women tend to receive less informal training on finances as well. Women frequently report lower levels of comfort with financial decisions.
And it can be dangerous, too: almost a third of women with poor financial literacy are likely to engage in dangerous credit card behaviors, which can cause long lasting harm to their financial security. Women are often the primary caregivers of children, and have lower earning power as a group, so it is especially crucial that women understand their finances, and the potential impacts of their financial choices.
“FEAR OF FAILURE IS BORN FROM THE LACK OF REQUIRED SKILLS!”
According to the Financial Literacy and Education Commission, there are five key components of financial literacy:
- Save & Invest
Developing financial literacy skills doesn’t have to be boring. Put some fun in finances.
You can do it!
DM #finance to learn more.