My father emigrated from Taiwan in the 1960s with only $17 to his name and the clothes on his back. Though he was poor in a material and financial sense, he never considered himself poor. His mantra was that financial wealth alone does not represent one's "true wealth."
My dad taught me not to define myself by how much I had, but by what I did with what I had. I learned early on not to let money be the sole determining factor for the decisions I made in life, but I also learned that, although money couldn't buy happiness, it could provide peace of mind, freedom and flexibility. I am thankful for the values my father instilled in me about "true wealth," but I am also grateful that he taught me about finances. My dad understood the importance of financial literacy and has left me a legacy that I am now passing on to my own three children.
Financial literacy is having the knowledge necessary to manage personal finances efficiently. Financially literate people know how to achieve long-term goals and make healthy financial decisions.
On the other hand, those who are not financially literate have difficulty applying financial decision-making skills to real-life situations. Not only do they tend to make unhealthy money decisions that create financial problems, they have trouble reaching financial milestones. In America today, financial illiteracy has become an epidemic. A study done by the Financial Industry Regulatory Authority Foundation estimated that nearly two-thirds of Americans can't pass a basic financial literacy test. That's a problem.
Whereas basic literacy is a priority for public educators, financial literacy is not.