Why is Financial Literacy an essential need for Indians?
Financial literacy is basic financial knowledge that helps in making crucial financial decisions whether you are a student or an adult. This skill not only enhances your decision-making power but also empowers you to make bigger financial decisions.
Major advanced economies–Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States–are financially literate. But even across these countries, financial literacy rates range widely, from 37 percent in Italy to 68 percent in Canada. There is a correlation found between high economic development to high financial literacy in the country.
India experienced economic growth of 7.2% in 2022-23 and the projected growth rates stand at 7.8%. India's rapid economic growth and expansion continue. However, financial literacy numbers tell a very different story.
Current statistics show that just 17% of teens and 27% of adults in India are financially literate. 62% of Indian women don't have bank accounts and have limited access to banking. Those are some pretty dismal statistics and don't support the economic growth of our country.
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In India, the majority of students are prepped to study in a good institute, and later get a good job with a high salary. However, no one seems to understand the importance of how to manage that money. This is the stark reality of the country.
I believe we should catch students young and teach them this most basic skill. Empower our coming generations rather than sit on the sidelines and see history repeat itself. Our school and college students should be made aware of how money works so that they can make well-informed decisions not only for themselves but also for their families.
Financial skill is no longer a luxury but a necessity. Even if your income is low and if you can manage it with various tools available, you will eventually win the financial game. Financial literacy helps in sustaining your overall well-being by helping you maintain your peace of mind.
When you have tools to manage your everyday financials to secure your retirement. Then essentially you are at peace and hence financial literacy skill becomes a need not a want.