What is Financial Literacy?

May 23, 2017 admin

Financial Literacy Australia

To be ensured of a stable financial status later in life, you have to comprehend the worth of money from a young age. Financial literacy is a crucial concept in today’s Economic world. People who are financially literate are far more likely to connect in economic life and feel confident as consumers proactively.

Teaching Financial Literacy to Kids

In the happening of the Global Financial Crisis, many governments all over the globe, including Australia’s, went into economic revival mode. According to an ASIC report released in 2011, “The crisis highlighted the importance of financial literacy and the need to reinforce core financial literacy concepts such as budgeting and saving, living within one’s means, responsible use of credit, diversification and investing only in products that are understood.

Financial Literacy Strategy

In 2011, ASIC released the first National Financial Literacy Strategy to integrate the repair of the financial state of nationally
Australians. In 2013, the Approach was reviewed and a 2014 -17 updated Strategy was launched. The National Financial Literacy Strategy provides a practical framework for action and defined five priorities:

1. Educating the coming generation through schooling
2. Raising the use of free, independent information and resources
3. Supplying quality guidance and help;
4. Enhancing coordination and partnerships
5. Advancing research and evaluation

What’s Financial Literacy

Because financial literacy is still a developing concept, the definition is sometimes floating. The recent National Financial Literacy Strategy report describes financial literacy as: “A combination of financial knowledge, skills, attitudes, and behaviours necessary to make sound financial decisions, based on personal circumstances, to improve financial wellbeing.” Outside aspects that affect financial literacy involve financial decisions, accessibility to suited financial resources and proper consumer protection and financial services control.

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