Published: 08th September 2023
International Literacy Day: Learn about early financial education from this 17-year-old entrepreneur
“Financial literacy is just as important in life as the other basics,” said American investor John W Rogers Jr
In a world where major life choices are driven by financial decisions, the importance of early financial education cannot be overstated. Equipping the younger generation with essential knowledge and skills to navigate the complex landscape of the private finances is a future investment that one can make. This will not only benefit the individual but will also leave a positive impact on society as a whole.
Enabling future financial independence
Having access to financial education at an early age enables individuals to take control of their financial future plans. By educating them about the fundamentals of budgeting, savings, investments and so on, ee equip them with the essential tools required to make informed choices and decisions. This step at an early age lays the foundation of financial independence and responsible budgeting throughout their lives.
Alleviate financial stress
Today, the majority of individuals are dealing with stress and anxiety due to financial burden and debt. One of the most significant advantages of providing financial education at an early age is its potential to mitigate debt and financial stress. When the youth will understand the after-effects of excessive borrowing and the importance of living within their means, the probability of them falling into a debt trap reduces automatically. This will help them lead a life free from financial stress and better mental well-being.
Preparing future entrepreneurs
Financial education not only fosters responsible spending and saving, it also nurtures the spirit of entrepreneurship among individuals. Young minds exposed to financial concepts are more likely to navigate the world of business. They learn to manage risks, identify potential opportunities and make critical decisions, which help them in making a place for themselves in the modern economy.
Bridging the financial gap
Financial education is the key to closing the wealth gap. It empowers individuals from all kinds of socio-economic backgrounds to take a step towards financial independence and make sound decisions. By levelling the playing field and giving equal access to everyone irrespective of their gender, caste, age, religion and so on, we can build a society that is fair and has equal opportunities for all.
Boosting generational wealth
Early financial education creates the foundation for the accumulation of generational wealth. When individuals learn about the power of saving and compounding, they are more likely to pass on this knowledge and assets to the future generations, creating a lasting legacy of financial security.
Strengthening economic resilience
Society as a whole also benefits from early financial education. A financially literate society is more economically resilient as they are better equipped to weather financial crises and take beneficial economic decisions. They tend to make informed choices about mortgages, insurance and other financial services.
While these are the major reasons why it’s important for the young generation to equip themselves with financial literacy, they are not the only ones. Being financially aware and advanced goes a long way in proofing one’s career and building a successful professional life as well.
(Kashvi Jindal is Founder of InvestTheChange. Views expressed here are her own)