Financial literacy helps us to take better financial decisions in our day-to-day life whether it is small or big. These small decisions can bring a tremendous impact in long term.
If we will see Worldwide, the percentage of Financial Literacy (FL) of India is ~25%, whereas in worldwide many countries FL is more than 60% which has a great impact for their personal wealth as well as for their country.
As per S&P Global survey Australia, Canada, Denmark, Finland, Germany, Israel, the Netherlands, Norway, Sweden, and the United Kingdom, where about 65 percent or more of adults are financially literate.
If financial literacy is high in other countries, why can’t it be high here? Why are we left behind? To become financially literate, we need to read books, visit websites, read newspapers and magazines, and listen to podcasts where we can learn useful information.
Remember that the earlier we start becoming financially literate, the better it is for us. It will help us save early, invest early, and build our wealth sooner compared to those who start later.
We recommend that parents should start educating their children financially from their teenage years so that when they become adults, they can make their own financial decisions independently and confidently.
Benefits of being financially Literate:
Good financial management and decision-making:
– Financial literacy helps to manage our hard-earned money wisely and make informed financial decisions.
– Now a day’s scam and frauds are increasing day by day. Being financially literate helps to identify financial frauds and protect our wealth.
Increased Savings:
– Financial literacy helps to reduce unnecessary spending, which ultimately increases our savings.
– It’s always a good habit to start saving money from an early state of our life.
Beating Inflation:
– Beating inflation has always been a major challenge. Financial literacy enables us to overcome this challenge by investing in the right asset classes.
– Most financial fund houses and investment firms prioritize beating inflation before increasing the return on investment.
Taxation Benefits:
– A significant portion of our money goes towards taxes, which we can reduce if we are financially literate.
– Being financially literate helps to take informed decisions when filing income tax returns. We will discuss taxation in a separate article.
Wealth Building:
– Building wealth is a major goal for everyone, but not everyone can achieve it. Many people lose most of their wealth by trying to get rich quickly. There is no shortcut to building wealth rapidly.
– Those who try to get rich quickly often lose their money. Building wealth is a long-term endeavor, and financial literacy is essential to help achieve this financial goal.
How can you become financially literate?
You can improve your financial literacy by reading personal finance-related books, newspapers, magazines, and blogs. You can also watch finance-related YouTube videos or listen to podcasts.
- Some of the good books to start with is:
- Rich Dad Poor Dad
- The Psychology of Money
- Think and Grow Rich
- The Richest Man in Babylon
Conclusion:
Financial literacy should be a common skill for people irrespective of gender or age group. It plays a crucial role in building wealth over the long run by enabling wise decisions in both personal life and business. Integrating financial literacy into our education system is essential for fostering a financially responsible society.
If you are reading this post till now, thank you! We will keep sharing informative articles on this blog, so please stay tuned with us and always stay healthy and wealthy.
All the best👍💯.