The Importance Of Financial Education

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“Money is eighty percent behavior, twenty percent head knowledge. It’s what you do, not what you know” (Ramsay, 2015). According to the Organization for Economic Cooperation and Development (2006), financial education is the process by which financial consumers or investors improve their understanding of financial products and concepts. Therefore, it can be stated that financial education is essential in the today’s economically developing world as it enhances the skills of money management and also brings about the financial stable atmosphere that is necessary for the survival and success of an individual, families and communities at a large scale. Thus, this essay argues for the statement written by Ram Karan (2013), that ‘Financial education…show more content…
The knowledge of financial education is important to all investors, whether a business man or a family. Financial management enables us to organize and spend our money wisely in different areas. It may help one to understand the significance of their savings, expenditures, liabilities, investments, and financial statements better. For example an industry worker in Fiji gets the wage every Thursdays, which is about $120, he spends all his wages till Saturday and then ends up borrowing money. This is due to poor planning of money due to lack of financial management skills in the communities of Fiji .The entire concept of financial education is to impart the skill to maximize the profit and to extend the business life period. Precisely, a well informed and financially educated individual can make better economic and financial decisions on the job, at home and in their community (Karan, 2013).The prime importance of financial education is to guide an individual or businesses to plan the budget for a better and smooth economical living. A financially strong person always adds to the progress of a nation. Successful businesses add more savings in the banks and make the most use of credit available, which in turn provides jobs and income to millions of people. Financial education empowers a common man and thus helps to prevent any financial loss or damage. A developing country like Fiji should have a strong foundation of financial education in order to have good financial planners in the years to come (Karan,

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