Celebrate Teachers’ Day with a school curriculum focused on financial literacy

By Vineet Patawari, Financial Mentor, StockEdge and Elearnmarkets

Why have we limited our learning to the “seven wonders of the world”? Why not teach children the eighth wonder of the world, which is the value of compound money? On this Teachers’ Day, let us promise to learn and teach finance as a core subject in our schools.

Youth financial literacy is often an underestimated concept. Parents who want their wards to be able to handle money matters during their adult years should instill in them the need to save and invest for their future growth. This is only possible when we teach our children what money is and how it affects almost every aspect of our daily lives.

Financial education is essential. It is an ongoing process that begins with encouraging children to keep money in piggy banks, informing them of safe investments like the Public Provident Fund (PPF), recurring deposits, and then the various opportunities for investment, including stocks and debt securities that transform money into a corpus necessary to finance your various life projects including retirement. The irony is that although financial education is at the heart of every key life decision, our educational institutions have been too slow to recognize this fact. The absence of essential subjects like financial planning from our school curriculum highlights the huge gap in our learning process.

India ranks bottom in financial literacy

According to a survey conducted by the National Center for Financial Education in 2019, India ranks last among all BRICS countries in financial literacy. The National Center for Financial Education also conducted a similar survey to find that only 27% of the country’s population is financially knowledgeable. The assumption that people will learn to manage their finances on their own has caused many people to lose their long-term savings. It also explains why most of us struggle to make income and investment decisions and have to deal with insufficient savings after retirement.

Financial education strategy

India has nearly 20% of the world’s population, but ranks among the lowest on the financial literacy index. The Indian government has recognized this anomaly in our educational system and has sought to correct it by promoting financial education in schools. The Reserve Bank of India (RBI) has suggested a five-pronged approach to promote financial learning in schools in 2020. This approach is based on five core learning principles including content, capacity, community, communication and cooperation.

The “National Strategy for Financial Education 2020-2025” advanced the idea of ​​developing content for school children, creating relevant financial study materials for adults, and encouraging community participation and collaboration through involvement of multiple stakeholders. The idea of ​​the government to strengthen the concept of financial inclusion in the country has also received support and recognition from other financial sector regulators including SEBI, IRDAI and PFRDA.

Aiming for a career in finance

Many people misinterpret chartered accountants, company secretaries, and cost accountants as financial management experts. This has led to the common myth that a career in finance is all about taking these courses. However, recent advancements in the financial industry have caused many people to plan their careers in finance. These include stock research analysis, portfolio management, actuarial consultants, insurance and investors, personal finance advisors, professional traders and more.

Learning finance is about understanding how money works. It’s about turning numbers, charts, models and theories into easily readable information that can be understood for the benefit of all. The study of finance is about grasping the principles of managing money and learning how to acquire and multiply it. In addition to knowing how to deploy and manage finance, students wishing to pursue a career in finance also focus on other financial aspects. These include credit, investments, banking, liabilities and assets.

Financial awareness as a life skill

Learning finance is like adopting an essential skill for life. In today’s complex world, it is not enough to identify education with simple schooling. To participate in modern society, we must aim for more. Our children will one day have to take charge of their financial future. So why not start teaching them about the unlimited possibilities of finance? Why not tell our children how thinking about finance will gradually translate into thinking about life? Why not help them gain financial literacy through financial awareness programs while they’re still in school?

Lack of financial literacy has cost many generations their hard-earned money. Why not curb the scourge of financial ignorance by adding financial literacy subjects to the core curriculum?

Sarah J. Greer