Financial Literacy is the knowledge that helps you make thoughtful and informed decisions about earning money, saving it, investing it, and spending it. It is more important now than ever because, while not every segment of society has access to formal education, every segment earns and spends money. The informed earn better, save better), and spend better than the uninformed.
Several trends are converging that demonstrate the importance of financial literacy:
- This is an age of abundant supply – of products and services, giving more choices to consumers; information becomes key to making the right choices.
- We are living longer. This means that an informed financial plan is what will guarantee a meaningful old age for us. Otherwise, we could become a burden to our families.
- Rising wages are often countered by rising costs, which continues to lend credence to the fact that how we save, invest, or spend is more important than how we earn.
Taken together, many people today are feeling a high level of financial anxiety. The right information is always an antidote to anxiety, and #FinancialLiteracyWeek establishes a platform for that information to flow and to foster deliberate action. So, here are a few things you should do:
- Follow this page throughout the week for insightful tips and financial advisory cues.
- Try to be as informed as possible about your finances. After all, you are the one who is going to have to live with your decisions.
- Work with a financial institution or financial advisor that is knowledgeable and that you can trust to help put your situation into perspective and help you evaluate your options.
- Try to develop good financial habits. Just paying attention to how you spend your money will probably lead to some ideas about how to save more. Over time, your savings will make a big difference.
- Do the easy things: Participate in your company’s retirement plan, contribute to a cooperative fund (locally referred to as ajoor esusu), opt to receive your salaries/wages directly into your bank account and hold less cash, start saving for different projects (like for a child’s school fees even if you’re not married yet), and teach your children saving habits early. These will spell progress, and the knowledge that you’re taking positive actions will spur you further.
- Take courses and participate in relevant workshops/seminars.
It is never too early or too late to improve your financial literacy. In fact, if you avoid major mistakes and do some of the most basic things, you may find yourself on the road to controlling your financial future with significantly less financial anxiety.