Financial literacy is a system of knowledge and skills on how to efficiently manage your money, understand financial services, and not to fall in financial scams.
Being financially literate today not only important, but also prestigious. Proper financial management is the right key to financial well-being!
Threats of low financial literacy are expressed in the increasing number of financial abuses, in the accumulation excessive loans that people unable to pay off, in the inefficient allocation of personal savings. This is an extra source of stress — why do we need it???
Financial literacy helps us effectively plan and use a personal budget; make decisions in the area of personal finances, based on our long-term interests and desires; avoid unnecessary debt; understand complex financial services and products offered by banks and other financial institutions; identify threats and reduce the risk of fraud.
We, being financially literate, are better prepared for crisis situations and can better protect ourselves: to deal with tax returns, to choose our own pension plans, to save money, to make the right investment and other financial decisions, and not to panic. Then we can not worry about our financial weel-being. 😉
Financial literacy involves the ability of people to live within their means, to monitor the state of their finances, to plan future revenues and costs, to choose the right financial products and understand the financial matters.
You should not completely rely on your government and «come what may» — it is necessary to think about your financial future and improve your financial literacy today.