Financial Literacy: Why It's a Necessary Life Skill for the Youth

To become financially literate adults, financial literacy must be taught to our youth at an early age. Ideally, this should begin not during their teenage years but even earlier — in fact, you can introduce your kindergartner to the importance of youth financial literacy by giving them a piggy bank where they can save up money at a very young age. This is doubtless a good start to inspire them to learn more about good money habits without necessarily shoving into their mouths as to why it's important as a life skill.

Besides using a piggy bank as an introduction to financial literacy during childhood, you can also teach your kids about the basics of learning financial matters or the importance of frugality in times of economic uncertainties. Of course, it should be introduced to them in a manner that is appropriate to their age and level of comprehension.

In this article, we'll discuss the crucial importance of financial literacy among the youth, and why they should learn these characteristically "adulting" things for their own financial future.

What is Financial Literacy?

Financial literacy can be straightforwardly defined as a person's ability to apply the financial knowledge that he or she learned in life either through accumulated practical experience over time or by enrolling in various financial literacy programs.

What is more, financial literacy simply means being smart and knowledgeable about the way people handle their personal finances, which may even involve engaging in money-making investment vehicles to grow their hard-earned money and making informed decisions when it comes to handling their finances.

Why is financial literacy important to the youth? Simply put, it is instrumental in making smart financial decisions once they flower into adulthood.

If financial learning only starts when they're already grownups, the attainment of financial literacy may be less likely. Or at the very least, they will get to reap the rewards of financial literacy much later in life. As such, the youth of this generation must be taught the value of financial education at a young age so they could grow to be financially literate adults who will get to unlearn the bad habits of financially illiterate adults around them who now regret failing to acquire the proper knowledge to be called money-smart individuals.

Financial Literacy for Youth and Why it's Important to Start Early

Financial literacy can already be considered a life skill that the youth must be able to learn little by little. Having said that, learning must start as early as possible. Below are just some of the top reasons why youth financial literacy is crucially important now more than ever.

1. It's one way to advocate for youth empowerment

Children go to school to learn about maths, sciences, English, and values education, among others. Financial education must be given adequate regard and needs to be taught among children too, whether at school or at home with their parents. As opposed to what some may say, no one is really a tad too young to learn about finances. In fact, empowering them to learn about finances earlier in life will drive them to become successful adults who will never be duped into scams of any kind.

2. The opposite can lead to bad adulting decisions

Another way to teach about the benefits of youth financial literacy is by talking about the opposite. Financial illiteracy results in adults making bad financial decisions, earning poor credit scores, and becoming at the receiving end of scams which, at least in part, are brought about by one's lack of knowledge of how to spot scams when potentially faced with one.

3. It's a way to get them away from vices

Learning about personal finances at a tender age can turn them into disciplined adults who will be rightfully conscious of their spending habits. In consequence, they will learn to be frugal and refrain from doing vices that will only incur unnecessary expenditures and ruin their future financial goals. Hence, teaching them about the basics of financial education brings about a new generation of young people who will later become good and productive citizens of a country that is battered by economic adversities.

4. It's dependable during financial emergencies

When emergencies occur, it often incurs large financial requirements. When children are taught to be financially literate and learn the value of money-saving practices, we are teaching them how not to grow up poor. That is to say, they'd learn how to not resort to bad debts, minimize unnecessary expenses, and save up for a long-term goal that will lead them to have the financial capability to afford what they otherwise couldn't if they become victims of financial illiteracy.

Financial education is vital in making our youth extra cautious about the way they spend and save their own money and manage their personal finances. This way, they'd know how to financially survive during economic downturns and even escape poverty and provide a more comfortable life for themselves and their loved ones.

One great indication of financial literacy is engaging in money-generating investments, such as for an affordable house and lot for sale. But most importantly, financial literacy means knowing when is the right time to invest and assessing one's current financial circumstances before actually making the investment and potentially resorting to financial institutions for large but worthwhile purchases.

Over the years, the real estate industry is proven one of the safest investment opportunities for financial enthusiasts. The property sector is known to resiliently survive economic recessions, making it an ideal long-term investment choice for those who are looking for an avenue to grow their money with fewer risks yet with greater potential for excellent returns.

Whether it's for investment's sake or for having a residential property for you and your family, Lumina Homes communities nationwide are built to characterize comfort and convenience for the benefit of present and future residents. An affordable house and lot bought through Lumina Homes will certainly satisfy aspiring property owners who are looking for both affordability and quality in a house and lot.

Apply your financial literacy skills by investing your money in a trusted real estate brand. Invest in Lumina Homes and get your dream house and lot in the Philippines this summer season.