Basic Financial Literacy
This module introduces you to the concept of financial literacy and its hues.
Here, you will understand how learning about finance can improve your financial health. This module aims to introduce the concept of setting financial goals and how financial literacy can help you achieve them.
What is finance?
Simply put, Finance is money management.
It is the process of acquiring money and effectively using it over a period of time. The term finance has its own definition at various levels:
- At a personal level, it is called personal finance.
- At the corporate level, it is business financing.
- At the government level, it is public financing.
In this module, we will discuss the Personal Finance level.
What is financial literacy?
Financial Literacy is the skill and knowledge required to manage one’s financial resources. Apart from taking prudent decisions, financial literacy also guides you to achieve your financial goals.
How old should one be to be financially literate?
Financial literacy does not require adulthood. It is a topic of common sense and you should be more interactive with this lesson, especially with your younger ones. Once you have laid a strong base and inculcated in them the entire ideology of managing money, say pocket money, your job is done.
As rightly said by Robert Kiyosaki, author of Rich Dad, Poor Dad, (a popular book on Personal Finance):
“We were not taught financial literacy in school. It takes a lot of work and time to change your thinking and to become financially literate.”
Habits may take time to develop, but once done, they become a lifestyle.
Next, we will understand the importance of financial literacy.