Role of financial literacy

Financial literacy is crucial because it empowers individuals to make informed and responsible financial decisions throughout their lives.

As a business student, here are my thoughts:

Financial literacy helps people manage their day-to-day finances effectively. It enables them to create budgets, track expenses, and avoid debt traps, ensuring financial stability.

And mostly with financial literacy, individuals can set and achieve financial goals, such as buying a home, starting a business, or saving for education.

After understanding financial concepts like interest rates and credit. Financial literacy easily equips individuals to use credit wisely and avoid high-interest debt.

It enables people to make informed investment decisions. Whether it's investing in stocks, bonds, or retirement accounts, financial literacy ensures that investments align with long-term financial goals.

Financial literacy helps individuals build an emergency fund, in case of emergencies, and also ensures they have a financial safety net when unexpected expenses arise. This security reduces stress and financial vulnerability.

In summary, financial literacy is the cornerstone of personal financial success, economic stability, and individual well-being. It equips people with the knowledge and skills needed to navigate the complex world of finance, ensuring a brighter financial future for themselves and their communities.

Authored By,

Sai Akshara

(Finance Student at St Claret Institutions)