THERE IS NO RIGHT TIME FOR BEING FINANCIALLY LITERATE
“There is a secret psychology of money. Most people don’t know about it. That’s why
most people never become financially successful. A lack of money is not the problem; it
is merely a symptom of what’s going on inside of you.”
T. Harv Eker.
Money has been a fundamental feature in human society, right from the early
civilizations. It is the lifeblood of trade and commerce. From the earliest bartering
systems to the financial markets of today, money has facilitated economic development
and growth. It serves as an instrument that shapes our lives and drives our aspirations.
Despite all this, the art of managing money remains elusive. Many individuals encounter
significant difficulties in managing their finances. According to a 2021 survey by the
Reserve Bank of India, majority of adults in India do not possess adequate knowledge of
basic financial concepts. In the present scenario, understanding how to handle money
effectively is more crucial than ever, not only for individual development, but also for the
overall progress of nations.
Financial literacy refers to the comprehensive knowledge of financial concepts such as
budgeting, investing, saving and managing debt, and its effective utilization. It equips
individuals with the skills necessary to make decisions about their money. Nirmala
Sitharaman, the Finance Minister of India has emphasized the importance of financial
literacy when she said “From childhood, we need to have financial education given to
students. We should not wait for them to become adults to understand how to handle
their money.”
Financial literacy is the cornerstone of economic empowerment. It opens up a gateway
for a future of stability and opportunity. Individuals who lack a solid understanding of
financial literacy are at risk of making unwise financial choices through poor spending
decisions that can have lasting consequences such as accumulation of debt and
bankruptcy.
Consequently, this raises an important inquiry: What is the right time to be financially
literate?
In our rapidly changing economy, the idea of ‘timing’ seems like a paradox. According to
popular opinion, financial literacy should be achieved upon major milestones of your life
- after graduation, or upon securing your first job. However, the reality is quite the other
way around. There is no ‘right time’ for being financially literate. It is a lifelong journey,
one that should be nurtured in youth and continuously developed throughout your life.
For instance, when a child receives their first allowance, they are faced with two choices-
either to spend the money or save it for future uses. These early experiences lay the
groundwork for understanding how to manage money wisely.
Just as a seed that must be nurtured and tended to flourish into a tree, financial literacy
also begins with foundational knowledge and strengthens over time through experience
and education. As the tree develops sturdy roots and a resilient trunk capable of
withstanding storms, financial literacy grows stronger when learned early. The earlier
start the more prepared and secure we become to face financial challenges in the future.
Basic financial conversations in the family such as saving for a vacation, or about
budgeting the groceries, can also enhance a child’s comprehension of financial concepts.
These lessons learnt at the early age serves as building- blocks that enhance future
money-based decision making.
Each stage of life puts forward a new challenge that requires solid understanding of
monetary principles. Many young adults graduate from high school with little to no
knowledge about basic financial concepts. A high school student preparing for college
may be confronted with choices regarding student loan and financial aid. The lack of a
solid base in financial education leaves them vulnerable to poor decision making that
may lead to financial insecurity
As we move forward in life, our financial situation starts to increase in complexity.
Financial literacy evolves alongside the world around us. With the rise of digital banking,
online trading platforms, and cryptocurrencies, staying financially literate means more
than just understanding traditional concepts. It also involves keeping pace with
technological advancements. This underscores the importance of continuously updating
our financial knowledge to keep track with the fast and ongoing changes.
In this fast-paced world, there is no singular moment where an individual achieves
complete financial literacy. It is not a destination, but a continuous journey in the face of
unexpected adversities such as job loss or economic downturns. By knowing how to
budget wisely, cut unnecessary expenses, and invest in safe assets, financially literate
individuals can withstand setbacks and recover swiftly. Moreover, financial literacy
fosters a sense of control and security, enabling individuals to plan for the future -
whether it’s saving for retirement, investing in education, or purchasing a home.
Ultimately, it serves as a safeguard, providing essential tools to navigate life’s financial
unpredictability and paving the way for a stable and prosperous future.
In conclusion, we can say that there is no right time to be financially literate as it is a
lifelong journey best embarked upon early in life. The myth of ‘right time’ should be
dispelled and individuals should be encouraged to start their path of financial literacy,
regardless of their age or circumstances. Prioritizing financial literacy enables us to build
a more financially secure future. The most opportune moment to start, is always the
present.
- Joan Josephine Joel
