Financial Literacy and Education

Financial literacy is a core life skill for participating in modern society. Adolescents and youth are growing up in an increasingly complex world where they will eventually need to take charge of their own financial future. Available evidence suggests that adolescents and youth have amongst the lowest levels of financial literacy. This is reflected by their general inability to choose the right financial products and often a lack of interest in undertaking sound financial planning. It is essential to equip adolescents and youth with financial knowledge and management skills to enable them to set goals in life and make plans for realizing them.

Adolescents and youth can benefit from financial literacy and education offerings that instill healthy financial habits early on. Vulnerable and at-risk adolescents and youth also need access to affordable and sustainable financial services including credit, savings, and insurance to help them to achieve these goals. Importantly, they need to know how to use these financial services and be able to make informed choices about saving and increasing saving capacity, about borrowing, about protecting themselves against risks. Through financial literacy and education, poor financial habits can be eradicated and displaced by more appropriate habits. Evidence suggests that innovatively crafted financial literacy and education programs and interventions can mold the behaviors of young people to align them with long term financial objectives.

Adolescent girls and boys are transitioning towards an independent life and a large part of their life is going to be about managing their finances. At the basic level, they must have an understanding of income opportunities, wise spending habits, saving, investments, and planning for the future. If adolescent girls and boys are financially educated at a very young age, they can make better decisions regarding money management and ultimately grow up to become financially literate women and men who have the knowledge and ability to make better financial decisions for their families. It promotes regular saving, wise spending, and ways to make the most of our resources. These skills serve as a foundation for young people, who are transitioning from dependent to independent roles in our financial responsibilities.

Adolescents and youth with disabilities face barriers that affect their financial capability and financial inclusion in the marketplace. Barriers include a lack of autonomy, skills, and opportunities. Financial capability informs the choices and decisions young people with disabilities make about activities of daily life, such as household budgeting, using transportation, and finding a place to live. Adolescents and youth with disabilities, however, face significant barriers to financial capability that adversely affects their independence and inclusion in the marketplace. Obstacles include a lack of autonomy, skills, and opportunities. Young people with disabilities may receive limited instruction in financial skills due to outdated beliefs in their capabilities and needs. They need the same financial knowledge and skills as those without disabilities – to manage money, create a spending plan, effectively use banks, reduce debt and use credit wisely.  Financial literacy and education are important pathways to achieving financial wellness for adolescents and youth with disabilities.

An investment in financial literacy and education for vulnerable adolescents and youth sets the stage for the many changes that are coming. It increases their ability to manage money, their confidence and their readiness for the challenges and opportunities in their life. Financial knowledge can open up new opportunities for vulnerable and at-risk adolescents and youth to work, build assets, and save. Access to and control over savings can help to protect against, mitigate, and cope with many risks associated with adolescence by providing resources to draw upon in times of need.

Better Futures for Children equips adolescents and youth, especially those with disabilities, and adolescent girls and young women (AGYW) with the skills and knowledge to take action and to achieve financial wellness. Financial wellness means having financial security and financial freedom of choice in the present and into the future. Our Financial Literacy and Education focuses on increasing financial knowledge, skills and confidence to encourage adolescents and youth to be proactive in terms of management of financial resources so that they can in turn protect themselves from various financial shocks, and to build assets to reduce their vulnerability and to use the transfer of liquid funds to invest in human capital development, thereby empowering them to efficiently manage their financial resources.

Better Futures Financial Literacy and Education interventions for adolescents and youth with disabilities empower them and their families and caregivers, seeks to enhance their financial capability by providing relevant information, tools, and supports that enable them to make informed financial choices, optimize the resources available to them, and overcome barriers to participation in the financial mainstream. Our interventions aim to develop the financial literacy skills of adolescents and youth with disabilities through accessible materials and training programs that teach investing from a sustainably responsible perspective. Financial decision-making skills are introduced from an economic perspective, but also from social, environmental and good governance outlooks in an innovative approach to promoting sustainability and financial empowerment.

Better Futures Financial Literacy and Education programs for adolescent girls and young women (AGYW) provides them with the opportunity to reflect on their current financial practices, to put terminology and economic meaning to what they already do, and to explore alternative ways to organize and use their existing resources. Our skill-building programs use simple case studies and activities to guide AGYW through the process of understanding where their money comes from and goes, making wise financial decisions, developing a basic budget, and accessing both formal and informal savings and credit mechanisms in their community.