Why the youths need more of financial literacy

Financial literacy refers to the set of skills, knowledge and capabilities that allows an individual to make informed and effective decisions with their financial resources. Throughout our lives, we have to go through the cycle of earning, saving, spending, borrowing and investing money. However, many lack the knowledge and strategy to maximize their financial decisions.
Given the knowledge gap and lackadaisical attitude that exists towards money management and financial planning, there is a great need to develop the necessary skills and knowledge at an early age. Against this background, it is important that the youth become well informed about financial literacy for the benefit of our economic future. This will prepare the youth to successfully transit from the safety of their parents homes to the real world economy.
Financial literacy is more than just being able to open a bank account or acquiring a credit card. It is at the heart of our economic future and long term security. It includes skills such as financial action planning for the future, and the discipline to use those skills to make sound and informed financial decisions every day. It also involves knowing the various products available in our financial system and how to use them for our own benefits and to improve our national economy. Financial products are not made exclusively for the rich and working class as erroneously believed by the youth. Some products like FGN bonds, state government development bonds, mutual funds etc can be affordably accessed by the youths. Getting involved with financial products benefits the youth not only in earnings but it serves as an avenue to get deep and practical knowledge about the economy and factors affecting it. Seventy percent of those swindled in the ponzi craze that hit the country last year were students. If the students are financially literate, it would be difficult for ponzi scheme vendors to make a kill from them. Ensuring that the youth become financially capable is now widely seen as a necessary ingredient in building our economic future and stability.
Financial literacy can help us develop competencies in areas such as budgeting, credit card spending and even retirement savings. This makes sense because parents generally shy away from discussing money with their children. Some parents don't even possess sound financial literacy themselves to be able to pass the message across to their wards. Financial literacy can be enjoyable for parents if a case study approach is adopted. For example; do I want to spend money in acquiring what someone else has without thinking of the personal financial implications? The method adopted in passing the financial literacy message across is vital, and as a society we have an obligation to prepare the youths to make wise and informed decisions in this modern world. Sound financial literacy goes beyond just to 'save for the rainy days'. The financial world has become more sophisticated and complex today than it has ever been and the youths need to know early enough that a credit card is not actually free money, but one of the expensive ways to borrow money. If not used correctly, it may end up being albatross for the individual and can lead to excessive debt.
It will also enable the youth to acquire the knowledge, skills and confidence that they need, not only to be able to manage their money effectively, but to know the various avenues and means to

invest, so as to contribute to economic growth. Looking back, many of the older people today would admit that if they had possessed the skills necessary to manage their personal finances earlier in life, it would have encouraged them to aspire for greater goals and achieve more. Some of the disadvantages of not acquiring financial literacy early in life are that the individual may be susceptible to fraud or not even see the relevance of saving for retirement. Building financially capable populations has massive future benefits for the economy.
This advice sounds very simple but, having the discipline to adhere to it in our daily living is difficult. However, a strong background in financial literacy will prepare the youths for the financial realities that awaits them.