1.1 Financial Literacy Defined
According to the OECD, “Financial literacy is a combination of awareness, knowledge, skill, attitude and the behavior necessary to make sound financial decisions and ultimately achieve individual financial wellbeing”. Similar to literacy, it can be viewed as an expanding set of knowledge, skills and strategies, which individuals build on throughout life, rather than as a fixed quantity. Consumer understanding of financial concepts and ability to correctly interpret financial data is what is generally referred to as financial literacy in the field of consumer finance.
Other definitions add that Financial literacy is mainly used in connection with personal finance matters (e.g. real estate, insurance, investing, saving, tax planning and retirement), including the understanding of financial concepts like compound interest, risk diversification, advantageous savings methods, and consumer rights.
Studies related to financial literacy in general measure three specific concepts:
1) Knowledge of fundamental financial concepts.
2) Awareness of products and services offered by different financial service providers and an understanding of the risks associated with using these products and services.
3) Understanding how to manage personal finances or use financial services.
According to the World Bank, the terms the term financial literacy is associated with financial knowledge, while financial capability is a broader term encompassing behavior and the interaction of knowledge, skills and attitudes.
According to Murray (2010) It is a set of capabilities such as general literacy, problem solving ability, numerical ability applied to personal finance. Financial Literacy is relative in the sense that it is specific to socioeconomic conditions of the people and is linked to their specific problems such as exclusion.
Atkinson and Messy (2011) define financial literacy as “a combination of awareness, knowledge, skills, attitude and behaviors necessary to make sound financial decisions and ultimately achieve individual financial wellbeing”
National Council on Economic Education (NCEE, 2005) mentions Financial Literacy as “familiarity with basic economic principles, knowledge about the U.S. economy, and understanding of some key economic terms.”
According to RBI, Financial literacy can broadly be defined as “Providing familiarity with and understanding of financial market products, especially rewards and risks, in order making informed choices”.
The President’s Advisory Council on Financial Literacy (PACFL, 2008) defined Financial Literacy, as “the ability to use knowledge and skills to manage financial resources effectively for a lifetime of financial well-being”.
Draft of National Strategy on Financial Education (2012), by Indian Government mentions that “The main components of financial education are understanding the key financial products one may need throughout one’s life; understanding basic financial concepts; developing skills and confidence to be aware of financial risks and opportunities and to benefit from them for making sound financial choices about saving, spending, insurance, investing; and managing debt throughout one’s life.”
Remund (2010) conducted a review of research studies since 2000 and identified five categories where the conceptual definitions of financial literacy fall:
1. Knowledge of financial concepts;
2. Ability to communicate about financial concepts;
3. Aptitude in managing personal finances;
4. Skill in making appropriate financial decisions;
5. Confidence in planning effectively for future financial needs.
CS 340 Milestone One Guidelines and Rubric Overview: For this assignment, you will implement the fundamental operations of create, read, update,
Retail Transaction Programming Project Project Requirements: Develop a program to emulate a purchase transaction at a retail store. This
7COM1028 Secure Systems Programming Referral Coursework: Secure
Create a GUI program that:Accepts the following from a user:Item NameItem QuantityItem PriceAllows the user to create a file to store the sales receip
CS 340 Final Project Guidelines and Rubric Overview The final project will encompass developing a web service using a software stack and impleme
