Financial Literacy

Financial literacy the knowledge of how to make smart decisions with money.
Involves one’s
ability to understand how money works, how someone makes, manages and invests it. Other
definitions include how money works and how it can work for you.
Benefits of financial literacy

1.Understanding financial literacy will be beneficial because it will provide basic tools for
budgeting and saving so that you can control yourself from unnecessary expenditures.
2.For families, being literate financially can help them save for their own home and their
children’s education, and their necessities.
3. For retirees, can live comfortably and not depending on their children.
3. It affects one’s ability to provide for themselves and family, attitude to money and
investment, as well as one’s contribution to the community.
4. Financial literacy enables people to understand what is needed to achieve a lifestyle that is
financially balanced, sustainable, ethical and responsible.
5.It also helps entrepreneurs leverage other people’s money for business to generate sales and
profits.
* Mbazigwe, (2013) states that one’s level of financial literacy affects their quality of life
significantly.
 The need for financial literacy to be incorporated in the school curriculum has just
been recognized even in the past, however, it was not well emphasized as a literacy.
Republic Act 10922, otherwise known as the “Economic and Financial Literacy Act”
mandates the Department of Education to ensure that economic and financial literacy
becomes an integral part of the formal learning. In like manner, CMO 74, 75, 76 s., of 2017
integrates Financial Literacy in the course Building Literacies.
Why Is Financial Literacy Important?

It equips people with an understanding of Basic Financial Concepts to inform their real-world
financial decisions. with this knowledge in hand, they’re better able to manage their money,
make sound decisions, and maintain healthy spending and budgeting habits.
What does it mean to be Financially Literate?
Financially literate means someone has an understanding of essential financial concepts these
include:
1.Budgeting
2.Saving
3.credit
4.Debt
5.Insurance
6. Financial decision- Making
Financial Literacy skills include:
 Creating a Budget
 Calculating interest
 Lowering cost by reducing want purchases
 Evaluating loan terms
 Comparison shopping
 Doing taxes
 Saving money
How to become Financially literate?

Financial Literacy is acquired by learning financial concepts and practicing them. Many people
receive informal financial education from family members or role-models-parents who teach
their children how to write a check, for instance. However, formal financial instruction from a
trusted provider offers a more comprehensive and reliable education. schools, banks and
nonprofit organizations are just few of the courses that offer financial education.
* To be financially literate, one must adhere to financial principles.
FINANCIAL PRINCIPLES FOR COLLEGE STUDENTS WHAT TO DO
1.Assess your relationship with money management. Also, understand the knowledge, action,
and behavior connection in personal finance.
*If you value money, then you should have priorities. Know what are your needs from your
wants.
2. Map your financial future and imagine your financial destinations as you progress through
life.
*Financial future can be your milestones.

a. Milestones are items that represent a change, but are not necessarily a goal. Social Security
payments start; children begin their careers, etc.
b. Goals, must have budget and time horizons i.e. You want to travel, where, how much are you
allotting? When?
3. Know your take-home net pay and analyze your gross paycheck, taxes, and deductions.
Make decisions to optimize your financial earnings, payments, and investment in retirement.
Record (keeping record of what you spend)

Review (analyze the information and decide what you do)
Take Action (Do something about what you have written down)
Which one would you save for or invest on? Know your priorities again.
a home • a car • an education • a comfortable retirement • your children • medical or other
emergencies • periods of unemployment • caring for parents
3. Budget your money, which is a must do. Budgeting is essential to help you realize your goals
and materialize your dreams into reality.
*Work according to plan and you stick according to plan.
4. Pay yourself first, which is a saving concept that helps you save before you spend.
*Save before you spend and save after you spend wisely.
5. Recognize your "NEEDS" from your "WANTS" and create a listing of preferences.
*Writing down your wish list helps you stick to your budget and reach your goals.
6. Do not borrow what you cannot pay back. Always try to save money on big purchases. Avoid
paying interest and late fee payments on any credit card purchases by paying your monthly bills
in full and on time.
*Its so easy to borrow and so difficult to pay back especially when you know you do not have a
stable source of income, so, if at all possible, avoid borrowing.
7. Stay insured throughout your life in health, medical, life, car, home, and other applicable
insurance plans.
*There are many insurance plans being offered by none-government institutions, what do you
most need insurance? Health? Home? Car? Etc.
Financial literacy is a basic knowledge that everyone needs to know in order to

survive in a modern society. We know and understand credit card and mortgage interest,
insurance, and saving and investing for the future. Having knowledge of your financial is
indicative of your ability to manage the family’s financial resources. Lack of personal
financial knowledge limits personal financial management and may cause financial problems,
resulting in lower financial well-being.
https://www.youtube.com/watch?v=GA9tcKudW5s&t=5s
https://www.investopedia.com/terms/f/financial-literacy.asp
PCK 136. BUILDING AND ENHANCING NEW LITERACIES ACROSS THE CURRICULUM

Financial Literacy

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Financial literacy the knowledge of how to make smart decisions with money.

Benefits of financial literacy

Why Is Financial Literacy Important?

How to become Financially literate?

FINANCIAL PRINCIPLES FOR COLLEGE STUDENTS WHAT TO DO

*Financial future can be your milestones.

Record (keeping record of what you spend)

Financial literacy is a basic knowledge that everyone needs to know in order to

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