Financial Literacy

Project
DATE OF ASSIGNMENT:
6TH FEBRUARY, 2022
DATE OF SUBMISSION:
14TH FEBRUARY, 2022
SAJAL KHULBE
221420
 Meaning of Financial Literacy
o Financial Literacy is the Knowledge and application of different
financial skills.
o It may include financial skills like budgeting, financial management and
investing.
o The meaning of financial literacy is the foundation of your relationship
with money, and it is a lifelong journey of learning.
o The earlier you start, the better off you will be because education is
the key to success when it comes to money.
Importance of Financial Literacy

 The overarching goal of financial literacy is to teach people how to

earn, spend, save, borrow, and protect their money.
 Understanding of income and expenses: Budget is the most
important task in spending your earning. Once you have budget you
can control keep track on income expenses.
 Repay avoid debt: Financial literacy helps in choosing the best way to
get out of debt either on your own or with help of financial convector.
 Protect yourself from fraud like situations: Basic knowledge of
financial literacy helps in foresting the fraudulent situations and risks.
Understanding your earnings mitigates the danger of such situations.
Scope of Financial Literacy

 Practically financial literacy is present everywhere, In our daily life,

budget education is applied (personal or family budget) and learning
about banking tools financial institution as well as understanding
economic concept and public policies financial literacy has become one
of the top priorities for most of the countries body as it is directly
proportional to economic growth of the country.
 The majority of the population is not aware about how to use and
manage their money.
 It is indeed high time for a developing countries like India to realize
the importance of financial literacy as such poor financial rate can to
be a major netback to Indian ambition of becoming an economic super
power in the coming years.
Prerequisites of Financial Literacy.

Managing the earning is a personal skill that gives you return throughout
your life taking the right decisions about saving your money and investing
in correct option available is a great responsibility so for this there are
some perquisites of financial literacy which one should keep in mind in
making financial decision.
The two prerequisites of Financial Literacy:
 Level of education.
 Numerical and communication ability.
Level of Education.

According to the financial literacy education commission there are five major components
of financial literacy which people should know they earn, spend, save, borrow & protect.
a) Earn: Before saving or investing one should know its gores or net earnings on monthly
basis after that one is ready to spend invest with personal budget.
b) Spend: Budgeting is the most important tool for achieving financial goal for this one
nudes to track down its spending over the course of one month and after that
craving a personal budget.
c) Save: Saving money is the most importance thing "o creating blame between
spending saving is the importance financial goal.
d) Borrow: At times there are situation when you have to borrow money to cover huge
expenses like home, car etc. irrespective of your saving. Borrowing is not dangerous
as long as you know how to compare loans maintain a good healthy credit score.
e) Protect: Once you are clear with your budget, expenses saving investment options
it's important securing your passwords to prevent and theft.
Numerical and Communication Ability

To improve your financial literacy ahead one should start reading and start
analyzing the numeric data, there are few key points one should keep in points:
 Learning about matters related to money: The first step is to read
everything related money matters from mag newspapers books of financial
literacy attending webinar searching online etc.
 Application of financial management tools: To further gain more financial
literacy one should start using financial management tools. These are many
financial services available online as well as offline with the help of these
tools one can create a budget and check it how effectively following the
budget.
 Ask for advice: These are financial advisor or counsellor who answers the
query related to investment debts evaluate your situation and make
recommendations how to manage your finances.
 Learn of budget: Learning to create a proper budget and stocking to
it allows you to pay down avoid debt save money plan for your future.
(e) Understand audit: How to use your credit effectively is the
important concept i.e. why credit is important what information goes
to your credit score how to improve credit score.
 Credit manage check saving account: This is also the important step
for financial literacy. allow you to keep your money safe and making
payment easier.
 Invest in retirement: Plan for your retirement should be done as soon
as possible. These are different retirement saving plans are available
in market which helps in curbing the inflation and leaving enough to
play for other expenses.
Thank you!