Why financial education is so important (even from childhood)

Since we start understanding things, this world creates a new puzzle, a new challenge for us, day after day. As our conscience gets developed, we realize most of the things we want in life, whether it's a new electronic gadget or an old classic car, have a price.

You pay for your needs. And this is what we get taught in our schools, by our parents and loved ones or by society. 

Study hard, get a job, work five days a week to get a decent lifestyle.

The irony is, while the whole education system revolves around making money, they never tell you directly how it works?

So here are some points which make it clear why having financial education is a prudent move and push you forth to start your journey of financial education.

1. Rules of money:-

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Most people we see every day, don't know how money works. They are simply doing their jobs, saving, planning a lot about holidays and retirements but at the end of the day, mourning about how money is a bitch and it's the root of all evil.

Financial education just forestalls it. You don't need a degree in economics to understand the rules of money. One can start learning the methods on their own. Free sources are available all over the internet. It gives you a clear vision and helps you plan things more subtly. 

2. Earning is learning:-

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As reading books about surgery doesn't make you a surgeon, likewise financial books are mere words that are worthless without practical knowledge.

Earning early in your life not only makes you feel self-dependent but it creates a profound understanding of money practically.

Certainly, you will be failed sometimes but this whole practice will lead you towards a better understanding of money management. When you put yourself in the process of earning, you see the difficulties and opportunities both at the same time. While opportunities excite you to keep going, obstacles beat all the enthusiasm out of you. This loop goes on until you learn to deal with them properly. 

3. Reconditioning is mandatory:-

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The conditioning is all that matters the most. Whether it's George Clason's The richest man in Babylon or Robert Kiyosaki's Rich dad poor dad, the most important point which is tried to be manifested in there is to change one's perspective of how he sees the money.

The essence is the same - Change your conditioning before it blocks your growth. 

What exactly is this conditioning?

Conditioning is every single idea you learn, hear, or encounter in your daily life, from early childhood to whatever age you are currently at. How do your parents think about money? Are they rich or broke? Do they try to cut off the expenditures or try to increase the number of income sources?

Every single detail you fill your brain with orchestrates you for the rest of your life so it's crucial to check if they are constructive - condition you for better or destructive - condition you for the worse.

4. Saving and investing:-

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Saving is an essential lesson we have to learn during the learning process but without investing it wisely, it's only a waste of your income and the time you spent to earn it. 

The inflation rate of India for 2020-21 was around 5.3 % while the average interest rates for saving accounts generally swing between 2.75 to 4.5 percent per annum. Simple mathematics can demonstrate how your money degrades its value over time.

Financial education makes you see through the predetermined money vignette and help you decide how much funds you require for saving, investing, and in a liquid state.

5. Planning tomorrow:-

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The final goal of financial education is to make you assertive in the money province. It is inundating to see how much easy it is, to tackle the financial problems once you get the desired tools.

Planning future goals, setting the retirement up, getting out of the proverbial rat race is not a piece of cake but the silver lining is - it is achievable. 

The cherry on the cake is, once you understand the rule of money, you no longer need to work for only bread and butter but you can further walk up the avenue of wealth and freedom.

Conclusion:-

The word finance is often misunderstood as complex and is capable enough to give nightmares for most of the crowd so we must see the picture with our own eyes without any prejudice.

Financial education not only solves this complex problem but gives you all the necessary tools and weapons to deal with real-life situations.

The earlier you start learning, the sooner you get the results.