Need of financial literacy among youth.

Need of financial literacy among youth.

This year shock for the whole world because of a covid-19 pandemic. This is unexpected for all countries. pandemic not affects society but also more on finances of people like employment, compensation, the salary of employees still now. Many surveys show that reduction in compensation of employees whether its salary or bonus both. Like companies in America change salary amount paid to the employee, the Chinese company does not like to change the amount of salary but reduce their bonus amount. And more countries like India, Saudi Arabia, UAE affected country like to cut of employee salary. But I think the most affected person who works for a business which nervily involved in international business affect more directly the most. They loss their temporarily or permanently lose their Jobs.

These current situations or obstacles create opportunities for the whole world to be financially literate. It sad to say that but its true people who financially aware of literature are the least effect by this pandemic. According to the report conducted by the Global Financial Literacy Excellence Center, only 24% of the Indian adult population is financially literate. This great depression creates a need or opportunity for all of us to improve our financial literacy.

When the term financial literacy comes it not limit to knowledge and understanding of financial concepts and risk but also skills, motivation, and confidence to apply such knowledge and understanding for making better decisions to improve the financial well-being of individuals and society and enable them to participate in our economy. Some Researchers like Mandell define financial literacy capacity to evaluate the financial instrument and make a better judgment in both choices of instrument and uses which give best long-run interest. It is also the ability to take simple decisions related to debt and applying knowledge about interest compounding to a real-life situation.

So, let’s talk about why financial literacy matter?

I can previously say that a financially literate person can be least affect financially during this pandemic Because they well financially independent in their life. They can understand the financial concept, rules, and regulations of any government regarding finance and able to manage finances efficiently Many studies show that people highly financially literate more like to plan about retirement because they know the power of compounding. They also correlated with a capability to deal with emergency expenses. With changing economic landscape, people now responsible for personal finances and investing spending money throughout their life. Increasing the number of financial instruments creates alternative financial services such as paying a loan, debt, etc. when it comes to debt behavior, a person less like to have a credit card and more like to pay the full amount balance of a credit card. Overall, financial literacy affects day-to-day life to a long financial decision, and important for both individual, society, and economy as well. There many financial books which I personal for financial literacy like Rich’s dad poor dad, the millionaire next door, The richest man in Babylon.

Financial literacy important skill which needs to increases your financial capability. It is like a global passport allows to make most of the excess of financial product and make sound financial decisions. financial literacy important as basic literacy like the ability to read and write. Without this people and society cannot reach their full potential.