Deficiency Of financial Education – A national issue and how to get rid of it.
By – Anant Kumar
The majority of the population often aren’t able to afford a lifestyle that they dream of. Those who have a decent source of income, and have found a way to enhance their financial load, such as paying credit card bills, monthly home loan instalments, EMIs for luxurious utilities, etc.
As the burden becomes worse, it cripples abilities, and their close ones, to live with freedom. They abstain from developing themselves, following their passion, or upgrading new skills. In the end, their growth rate is being prevented due to budgetary pressure. The root cause of all this is having a deficiency of financial education.
Generally, people spend the first quarter of their life just for grabbing the highest degree and the later part, on making a living off the skills obtained from their education. However, nobody institute or college teaches us how to manage our earned money.
But you cannot just blame a single entity, this is a national issue. We all – parents, the educational industry, and the government – must work together in this area.
What is financial education?
Financial education is “the ability to make a smart financial decision which results in fancied financial outcomes.” It is not about knowing the stack and complex financial concepts it is simple skills that make the right financial decisions regularly, such as educational loans, buying a home, financing a car, and saving for retirement, and ultimately become financially self-sustainable and independent.
What is a deficiency of financial education?
Not able to understand the basic financial principal like how to make money and let money to make money, budget planning to understand, how to become financially free, money negotiation, and manage financial risk.
Why is it national challenging?
Job crises in India have increased more than ever. It’s not that we don’t have ones, it is not because we don’t have any talents who are ready for jobs. According to UNICEF, more than 50% of Indian students and students from southeast Asia don’t have the required skill for getting a job. There is appositely no space left for mediocrity. If you were graduated in the 90s, you would still have a chance to get a decent job by showing your degree. But now it is quite a different situation.
Every year, India produces more than millions of engineers. According to employability assessment company data, 80% of Indian engineers are unemployed for a job. The problem isn’t limited to the engineering stream – it’s the same with other streams like commerce, arts, and medical. In the study, most of the students have lost their interests. As soon as youngsters hold an undergraduate degree, they are forced to take higher education and travel to foreign countries like the US, Europe, and Canada – This is their final destination.
Some parents take education loans for their children. In another way, students sign their indentured servitude. If they are blessed enough to find a job, they work years with some MNC, and by the time they are free, a passionate dancer becomes HR, a gifted singer becomes software engineer, and a great writer becomes a consultant.
A question always occurs, why do youngsters feel obliged to take a specific subject without having any interest in it? The answer is, their mindset of choosing the stream of education depends on money. From the first day of school, we are taught, complete a degree get a job, and earn a salary is the stared career template. A higher degree pays a higher salary. As soon they got a higher degree, the interest of an individual becomes unimportant.
People are willing to quit on their calling for the security of an unpleasant job. Well, there is nothing wrong with it. Choices can be made by an individual at any time. But the most concerning part is people don’t even know that they have dozens of options to make money and grow their finances.
It has dark truth that most youngsters of this generation are perpetually steered-out and worked very hard. They are struggling to manage their basic expenditure. This affects their mental well-being and happiness.
Another collateral damage of such learning for earning mindset is lack of employment. Students who don’t want to get involved in a stream of education are less likely to perform in it. Over time, they graduated in it, and naturally, the overall quality of our degree holders becomes substandard, and who would not prefer to employ such graduates?
Today, India badly needs those professionals who are skilled in their domains that can solve problems. Of course, we have thousands of them, but if our millennials are not utilizing education to sharpen their inherent set of skills, the outcome is just mass production of knuckleheads. The crisis is going on right now. Unemployment point finger toward education without the purpose of learning.
What is the solution? How can this be done on a personal level?
Youngsters must recognize a real passion and work on it to shape it; education should be considered as a tool for solutions.
It looks good in theory. But, what is the ground reality? it could be possible that people’s passion for the profession isn’t likely to pay their bill. Suppose that I am a good writer, nobody read a published book as of now. I am a developing comedian, but I can buy a decent lifestyle as of now. Does that strike a chord? Well, yes, it is a fair question. So, what are we supposed to do in such a case?
First, you should not make a bad investment of your time or money. Do not let yourself into snowballing debt just to get a degree. Your passion and source of making money could be different. You do not always need a degree to make money.
To lead a financially stress-free life, you need to start investments, both time and money. Educate yourself with some of the basic financial principles, such as how taxes work, find out more about the different industries, learn how to make money to work for you.
Although, financial illiteracy is a national issue. The government and we must make efforts to overcome the situation. The future will belong to talents – a talent honed by relevant education, motivated by passion, and supported by financial education.
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