Benefits of financial literacy | Importance of financial literacy

Why financial literacy is just as important for girls today

April 15, 2023 Educate Girls
Why financial literacy is just as important for girls today

We talk volumes about the importance of literacy and education for children, especially girls who come from underprivileged families; however, there is one type of literacy that we often forget about. Financial literacy is just as important, because the world that we live in today is one where money matters and matters of money are crucial. At Educate Girls, we aim at empowering girls and women, so that they can not only take care of their own selves and their families, but also become contributing members of the society. 

What exactly is financial literacy?

When we are talking about financial literacy, it is important that you first understand what the term actually means – it is the ability to not only understand, but also effectively utilise financial skills that are often required in the daily life. This could vary from managing personal finances, creating budgets for the home and executing the same as well as making some investments. While financial learning has to go on for life, the basics need to be taught at a young age; having this type of education along with the normal stream, will allow girls to become independent and financially stable too. 

It has been observed that many men in India are aware of how to earn, budget and invest the money they earn, a large percentage of women, particularly those who have not have had a formal education, are unaware of the needs of learning about money matters. Apart from having to handle the house, traditional Indian women often have not had to be concerned with money. 

Why have women and financial literacy never been inter-related?

For the longest time, only the men have been the breadwinners of the family and even if women did earn something, through craft or housework, their income was never considered worthy enough of being recognised. Added to that, financial illiteracy leads to several other problems too – for starters, debts are a common problem with financially backward families, mainly because the women of the house might not know about proper budgeting or how to spend in a smart way. Women and financial literacy are commonly kept apart, because it is believed that women are not capable enough of handling money and they will not know anything about long term planning. This was also done due to a certain fear that should women get financial independence and literacy; they would become a lot more independent and adept at decision making.

Studies and surveys have shown that even though women form 48% of the Indian population, only a tiny percentage has a say in financial matters. As per another survey, 59% women did not take any financial decisions on their own; 39% kept their financial planning limited to the monthly household budgeting. 

Why do women need financial literacy?

At Educate Girls, we work with so many girls who come from financially backward families and we often get opportunities to interact with the older ladies as well. That is when we understand why financial literacy is important – it is not only essential for independence, but also to tackle tough situations. Here are just some of the reasons why it is imperative that girls get a proper financial education:

  • Should there ever be an emergency – medical or otherwise, with a proper understanding of money matters, the girl will be able to handle things better. In the worst-case scenario, if she is left widowed or has to live alone, she will know how to take care of herself and those around her too. 
  • When a woman is financially literate, she will not only be able to handle the day-to-day budgeting of the household and keep track of the expenses, she will also be able to spend more thoughtfully. Moreover, when they know about how to handle money, they will not how to tackle the cost of living and inflation too. 
  • In most households, children spend a lot more time with their mothers, rather than their fathers – so when the mothers are financially literate, they can inculcate the importance of financial literacy into their children as well. 

It is high time that we understand that financial education is just as important as the regular education one would get in a school. Financial literacy, a sense of freedom and that eventual empowerment of women, all go hand in hand. When a girl gets both types of education, she will be able to build a better life for herself and those around her. Whether it is deciding when she wants to get married or even having the courage to walk out of an abusive family, with financial independence, it will all become possible. With financial literacy and education, she will become equally responsible for her family and will be fit to contribute along with others. 

With organisations like Educate Girls coming to the forefront, girls from backward families and financially challenged backgrounds are now getting a chance at not only getting back into school, but also learning more about the things that will eventually matter in the real world! We are offering them a chance to reach their full potential and becoming valuable members of the society and we invite you to join our cause!

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Posted on April 15, 2023

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