Looking around our society, we discover that there's a high level of financial illiteracy in our world today. Hence, the reason for a lot of money/ wealth mismanagements, unnecessary debts, bankruptcy and other financial problems people are currently experiencing. Thus, there's an urgent need for an intentional and adequate financial education.
We need to know that without proper financial education, these financial crisis will continue to prevail. It's more saddening that our (some) governments lack this in-depth knowledge about money and everything finance. Because if they do have the knowledge, then there won't be these many debts incurred by many governments. The issue of inflation would have been controlled and handled. Their lack of proper financial education is of gross concern because it affects every person across all levels even to the grassroot level and high class individuals. But we won't be talking about the governments today rather individuals.
The Genesis of the Problem
Growing up as a child, I can't recall a particular day my parents sat me down and taught me about the concept of money and how money works. They never intentionally taught me about finance. All they did was give out cash each time I made a request. So, I grew up believing that money is quite easy to come by but we all know that's not true. Yes, making money can be easy when you do the right things (like providing the needed solutions and solving problems) but generally, wealth creation isn't an easy road to go down. If it were that easy and simple to create wealth then everyone would be billionaires. But you see that we even have more poor people than rich persons.
This is to tell us that there's a price to pay for wealth creation and one of such prices is being equipped with the right financial knowledge. Having acquired the knowledge, you then apply . It might interest you to know that the application of knowledge is as important as the knowledge itself. Knowledge becomes useless when it's not being put into action. To some extent, this is what differentiates the rich from the poor.
Moving forward and keeping my parents aside, I come down to my high school and college days, there has been no single course that indepthly taught about money and finance. The few ones I had were just on-the-surface discussions.
So, what are my implying?
Everyone has a role to play in the dissemination of proper financial education. Beginning from parents, elder siblings, school teachers, pastors, co-workers, friends to mentors etc, each of us with a higher degree of knowledge about finance should do well to impact same to those who lack it.
As a parent, make it a point of duty to teach your children about the concepts of money and wealth creation except you want your wards to just be average citizens. You'd agree with me that this is very necessary and vital. As a friend or mentor, do well to make the subject of money a part of your discussions.
Coming down to our schools, it is important that finance and money courses be introduced as part of the curriculum. This will be far more impactful, useful and appreciated than some of the irrelevant, outdated and non-applicable subjects/ topics taught in schools. People need to have the right knowledge and mindset about money so that, they can avoid many financial crises.
It's easier to teach a young man than to teach an old person. In essence, the best time to start educating your children about money is when they are still young. It becomes a bigger problem when they grow up learning the wrong concepts. As you very well know, unlearning a wrong thing and relearning the right thing is more tasking.
Like aforestated, there are many poor persons in the world today. Also, there are numerous financial crises in our society of late. It might not be affecting you directly but indirectly these financial problems in the world affects you which is why everyone should be concerned.
Understanding Spending, Saving and Investing
The understanding of these three is very key to anyone who wants to gain financial independence or some level of financial satisfaction. Speaking of satisfaction, no one has ever made enough money. In fact, the more you make the more you want to make. People need to be taught and educated about the roles of spending, saving and investing in creating wealth.
Financial education is necessary for knowing when and how to spend. Also, it helps one to know what to save, how to save and where to save. Equally, it aids people in making the right investments and at the right time.
Sadly, many spend carelessly and on liabilities. Some only remember investing and/or saving after they might have spent already. Wealth has never been created through spending or saving but rather through investing.
Debts and Borrowing: This is another major problem encountered by a lot of persons. However, this is where financial education comes in handy. Borrowing isn't bad until it turns to become a lasting debt. Also, borrowing isn't bad until it is being done for the wrong reasons or purpose.
Everyone has borrowed money before at some points or the other, including rich persons. The disparity between two people who borrow is the purpose of the borrowing. People borrow for many reasons but borrowing and incurring debts should not be a lifestyle. Why would you borrow to spend on liabilities? Why borrow to impress? Why borrow to live a life you cannot comfortably attain? That's a different level of financial. If you must borrow, borrow for good reasons. Intelligent persons borrow money for investing knowing fully well, it will yield profits. Some borrow during market or stock crashes to invest; now that's wisdom.
Debt is a very terrible thing. It eats into your future whereas you're still in the present. So, because the money comes, it has already been spent. You see that these sect of persons live a life of continuous borrowing. With the right financial, this kind of lifestyle will be avoided. I mean no one wants to live such a life.
On the whole, everything in life has a principle and once you follow these principles, you are bound to get good results. Wealth creation and/or financial success has its own unique principles. It's important that we know these principles and also apply it. This then makes financial education a necessity.
Read Also: How To Chart A New Course For Your Finances in 2022
