What is Financial Literacy?

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Financial literacy is the ability to understand one’s personal finances (the management of money), and the skills to make good choices with money. Major skills involved in being financially literate include knowing the how’s and when’s of budgeting, saving, making investments, and managing credit and/or debt.

 

Why is Financial Literacy Important to Teenagers?

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When hearing the words “financial literacy,” teenagers may immediately think that it’s a topic for grown-ups and people in business or entrepreneurial ventures: it may seem distant and irrelevant to his or her life. This is, however, untrue as financial literacy, though it may not be as important as it may be in adult life with all the taxes and bills, is still something that can be very helpful to learn and understand as a teen.

 

If you are reading this, there is a good chance that you are currently in high school. High school is a good time to learn and create good financial habits that you can carry into adult life. For instance, your junior year of high school is an especially good time to start becoming financially literate. With college being only two years away, grasping an understanding on how to earn, manage, and allocate money would be beneficial.

 

 

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Source:

https://www.investopedia.com/terms/f/financial-literacy.asp

Author: Jason Fernando

Date Published / Last Updated: June 29, 2025

Date Accessed: July 26, 2025