Financial Literacy & Education – Are They Important?

Financial literacy is the confluence of credit and debt management, financial management and the knowledge necessary to make financially responsible decisions. This includes knowing how a checking account works, how to avoid debts, and understanding the real meaning of using credit cards.

5 Trends Compelling Financial Literacy

1. Consumers shoulder more of the financial decisions.
2. Most consumers are asked to choose from various investment and saving products.
3. There is a lack of government aid these days.
4. People today have longer life spans.
5. The financial landscape is changing because of today’s technological advances.

Why Financial Literacy Matters?

A study from financial services company revealed that those with high financial literacy plan for retirement and have double the wealth of those who don’t plan for retirement. On the contrary, those with low financial literacy borrow more and have less wealth. Also, they don’t invest and they have a poor understanding of the terms of their loans or mortgages. An increase in financial literacy will have a thoughtful impact on consumers, along with their ability to provide for their future whilst avoiding any pitfalls of debt.

Financial literacy will have a great impact on the daily decisions people make when buying a home, trying to balance a budget, ensuring an income at retirement, and funding a child’s education.

Trivia Info Resource: catchtherisingtide.com.au