Personal Financial Literacy Concept

Financial literacy can be defined as possessing understanding of how money works in the world, teaching critical skills to individuals on how to make informed, effective financial decisions grounded on their resources and situations.
Investopedia define financial literacy as “the education and understanding of various financial areas including topics related to managing personal finance, money and investing. These topics focus on the ability to manage personal finances matters in an efficient manner, and include the knowledge of making personal finances such as investing, insurance, real estate, paying for college, budgeting, retirement and tax planning”.
Personal financial literacy is knowledge, skills, attitudes and behavior individuals need to acquire, preferably from young age, to be able to use and control personal finances
responsibly. The concept my entail investment decisions, real estate, funds for studies, budgeting and planning to mention a few but it can also extend to the related transactional details such as legal knowledge, the use of technology , micro and macroeconomic issues.
(Atkinson & Messy, 2012) define financial literacy as ‘a combination of awareness, knowledge, skill, attitude and behavior necessary to make sound financial decisions and ultimately achieve individual financial wellbeing. And of more related concept is financial education which is defined as “the process by which financial consumers/investors improve their understanding of financial products and concepts and, through information, instructions and/or objective advice, develop the skills and confidence to become aware of financial risks and opportunities, to make informed choices, to know where to go for help, and to take other effective actions to improve their financial well-being and protection” (OECD, 2005).