The Importance Of Financial Literacy

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Financial literacy can be the first step out of poverty.
According to investopedia.com, financial literacy is the education and understanding of various financial areas. This topic focuses on the ability to manage personal finance matters in an efficient manner, and it includes the knowledge of making appropriate decisions about personal finance such as investing, insurance, real estate, paying for college, budgeting, retirement and tax planning. Basically, financial literacy is the knowledge on how money works. Specifically, it is a skills and understanding of Individual that allow them to make an effective and sound financial decision. Financial Literacy is more important than ever in today’s world. It is very essential that each person should have the ability to understand how money works ; how to manage it to earn and to invest or how to donate it to others. Financial Literacy provides the necessary knowledge, skills and tools for individual to make informed financial decision with confidence, to manage personal wealth with efficiency and to increase financial competence to demand for better financial services (Ali, 2013).

State of Financial Literacy in the Philippines
The Ratings Services survey of Standard & Poor in 2015 showed that only 25% of Filipinos are financially literate which means that about 75 million …show more content…

Among these OFW-upheld families, 48.6% are investing, 31.4% of these family units reserved money for bank savings. This is basically uplifting news as the numbers has developed from the previous year. In any case, the worry is that with how does the money is really being invested. It's been accounted for that the greater parts of these families have purchased resources which later ended up being liabilities. While most Overseas Filipino Workers (OFWs) earn better in other countries some of them still experience financial problems despite years of hard work due to inefficient money

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