Lifestyle12 Reasons to Prove the Importance of Financial Education

12 Reasons to Prove the Importance of Financial Education

Financial literacy or financial education is the most crucial knowledge for Indian youth. The importance of saving, of using money in the right ways, and related concepts are not just important for personal growth but also for the development of the country. It has also been argued that it is important to add financial literacy to the curriculum of schools and colleges.

12 Reasons to Prove the Importance of Financial Education

1. Helps in saving

We all had piggy banks in childhood, and whenever it got filled a new one was given to us so that the habit of saving money could be inculcated at an early level. This is a way of giving financial education. Savings are beneficial when the time is hard and it helps in overcoming any unexpected crisis. This capability only develops when a person knows finance that is why financial education is very crucial.

2. Making the right budget

Making the budget monthly or yearly is important to manage money efficiently. But a person who has little knowledge about the importance of budget making might spend all the money without thinking and would be left with very little money by the end of the month. Having financial education helps in this situation.

3. Planning finance

Planning where to spend money not just for consumption but also for investment is a way of growing in life. It helps in savings for the future and helps in the growth of the overall economy. Financial education helps in planning your finances effectively.

4. Making intelligent investment decisions

Investing your money in the right place is as important as knowing the importance of investment itself. Some assets might not give enough returns while others can be very profitable. To know this one needs to have basic financial knowledge.

5. Taking the right consumption decision

Right consumption decisions are not just beneficial for the overall expenditure but also for the health and well-being. Few commodities might be priced high due to economic reasons for compelling you to buy them. If you know about economics and finance your decisions in this kind of situation might be positive for yourself and others.

6. Expand your wealth

Once you start investing in a better way and save the money, this automatically yields huge returns and expands the wealth. A financially educated person might also not get driven by popular economics and save money from spending at the wrong place.

7. Saves from crisis

Savings form the basis of financial education, the major reason being its ability to save you from crisis. Money saved today helps in the future. It helps you deal with unexpected circumstances and make a crisis situation easier.

8. Helps everyone in need

Financial education directly benefits you, but it has indirect benefits to everyone around you. It helps in managing crisis situations not just in your life but also in the lives of family and close friends. If anyone does not have savings for an unexpected situation it might lead to a disastrous situation, financial education comes to the rescue at these times.

9. Preventing frauds

Frauds and fake finance schemes are mushrooming at a fast pace. The luring deals are hard to resist and investing in them takes a toll on the entire finances. To prevent fraud and stay away from these kinds of schemes financial education is important.

10. Helps in understanding policies

Financial education helps in understanding center and state government policies better. From time to time the government releases economic policies to help the poor and common people. However, this can only be understood if you have proper knowledge of finance.

11. Makes you aware of geopolitical news

Geopolitics is all about the economy. If you understand the economy and finance at large, geopolitical news will make more sense; however, if you don’t have any idea about finance, geopolitics may not be easily understood. This is why financial education is important.

12. Helps you help others

Financial education not just helps you, but others around you. As already pointed out, it helps in managing a crisis situation. Therefore, it can be said that being aware of finance and the economy not just helps you but also other people around you.

Financial education is an integral part of everyday life. It is not a choice but a necessity that will save all of us in our time of need. To begin with, it should be planted in the minds of every young kid and used as a tool to make everyone aware of its importance.

Read also12 Reasons Why You Should Not Regret Your Decisions


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