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Lead the way: Integrating financial literacy into school curriculums

Can teaching financial literacy in school really make a difference? Explore the impact of early financial education on students' decision-making and futures.

financial literacy in schools

Understanding financial literacy is crucial in today’s economy, yet a significant portion of India’s population lacks this essential knowledge. With only about 27% of Indians and only 16.7% of students being  considered financially literate, there’s a clear need to embed financial education early in school curriculums. This gap in financial understanding can lead to challenges in managing personal finances, making informed decisions, and securing a financially stable future. 

The importance of teaching money management in schools equips students with the skills to take financial responsibilities confidently. This blog highlights the importance of incorporating finance in education, providing students with a foundation for making smart financial choices throughout their lives.

Also read:  Deciphering the numbers: Insights into the financial literacy rate in India

Why is financial literacy in schools necessary?

Just as having a solid education is important, so is having a basic understanding of money management. Teaching financial literacy in schools is not only about creating smarter consumers, but also about establishing a foundation for responsible financial behaviour throughout life. Here are benefits of incorporating financial literacy into school curriculums:

Building a sense of responsibility

Early financial education contributes to the development of a sense of accountability for money management. It teaches school children how important it is to manage their allowances wisely and the value of money. This foundational knowledge encourages them to develop reasonable spending habits and prepares them for handling larger financial responsibilities in the future.

Empowering decision-making

Understanding money management from a young age equips students with the skills to make informed decisions about their finances. This includes everything from choosing career paths that align with their financial goals to managing personal finances and student loans responsibly. A solid grasp of financial basics enhances their confidence, making them less dependent on external advice for their financial decisions.

Preparation for adult life

There are certain financial obstacles associated with the transition to adulthood. Early financial education guarantees that kids are more equipped to take on these difficulties. They learn to budget, save, and invest wisely, skills essential to their development on both a personal and professional level. Moreover, it sets them on a path to financial independence, reducing stress and increasing their ability to navigate life’s financial ups and downs.

Enhancing career readiness

Becoming financially literate is essential for becoming career ready. Students learn to understand financial documents, evaluate job offers, and make informed decisions about benefits and retirement plans. In today’s competitive employment market, where financial benefits can have a huge impact on career choices, this knowledge is vital.

Fostering entrepreneurial spirit

For individuals with an inclination towards entrepreneurship, it is vital to understand the monetary aspects of managing a business. School-based financial literacy introduces students to the essentials of budgeting, financial forecasting, and business planning. This fosters creative thinking and problem-solving abilities in addition to preparing them for the difficulties of launching and running their own company.

Creating responsible economic citizens

Finally, financial literacy for students contributes to the development of responsible economic citizens. It enables students to participate meaningfully in economic discussions, understand consumer rights, and make choices that benefit the community. Knowledgeable students are more likely to contribute positively to society’s economic well-being, understanding the broader impact of their financial decisions.

What students can learn about financial literacy?

Here is a breakdown of the key financial concepts students can learn through incorporating financial literacy into school curriculums.

  • Understanding the value of money: Teach students to differentiate between wants and needs, promoting smarter spending decisions.
  • Budgeting and managing finances:  Introduce basic budgeting skills for wise financial planning, from everyday costs to long-term savings for future goals.
  • Saving strategies: Highlight the importance of saving, demonstrating how small savings can grow with interest over time.
  • Earning and income: Students will explore different ways to earn money, understanding that hard work and innovation can lead to financial rewards. This encourages a work ethic and creativity in thinking about income.
  • Banking and financial services: An understanding of basic banking services, how banks operate, and the role they play in personal finances is another key aspect. The relevance of banking in money management as well as the various kinds of bank accounts and how to use them will be taught to the students.
  • Understanding financial products and rates: Students will gain insights into various financial products and what standardised rates mean for loans, savings, and investments. With this understanding, they will be able to choose monetary products in the future with confidence.
  • Financial policies and taxes: A general understanding of financial policies, including taxes, is essential. For instance, students might learn about the country’s new tax system. This helps them grasp how government policies affect personal finances and the importance of complying with tax laws.
  • Day-to-day expenses: Managing day-to-day expenses is a practical skill students will use throughout their lives. Learning to track and control daily spending helps avoid financial pitfalls and ensures that they can live within their means.

You may also like:  Path to financial freedom: Your financial literacy PDF guide

Government’s role in school curriculum and financial education

The role of schools in promoting financial literacy among students cannot be overstated. The government and educational institutions have worked together on a number of initiatives to include financial literacy in the curriculum.

The National Centre for Financial Education (NCFE) is a prime example of a government-backed initiative aimed at promoting financial literacy. The NCFE focuses on financial educating all sections of the population including school students, supported by major regulatory bodies like the 

  • Reserve Bank of India (RBI), 
  • Securities and Exchange Board of India (SEBI), 
  • Insurance Regulatory and Development Authority of India (IRDAI), and 
  • Pension Fund Regulatory and Development Authority (PFRDA). 

Students in Class VI through X receive financial lessons at their schools under the NCFE’s Money Smart School Programme (MSSP).

Also, in June 2021, the National Payments Corporation of India (NPCI), in partnership with the Central Board of Secondary Education (CBSE), helped in developing a comprehensive financial literacy curriculum for students in grade six. The Financial literacy textbook was introduced as a component of a new elective subject on financial literacy, designed to equip students with an understanding of fundamental financial concepts early in their education.

In collaboration with educational bodies like the National Stock Exchange (NSE) Academy and Maharashtra Knowledge Corporation Ltd (MKCL), the government has launched basic courses in personal financial management. These courses cover fundamental aspects of finance and are designed to be accessible and informative, providing learners with a solid grounding in personal finance. 

In strategies for integrating financial education into schools, governmental projects play an important role. Additionally, private initiatives complement these efforts by targeting specific needs and demographics.

Also read: Unlocking prosperity: The transformative power of financial literacy


Integrating financial literacy into the curricula of schools can help prepare young minds for a future where having financial knowledge is as important as academic proficiency. By providing a foundation for making informed financial decisions, we not only empower individuals but also develop a society that is equipped to face economic challenges with resilience and innovation.

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StockGro Team

StockGro is India’s first and largest ‘Social Investment’ platform aimed at helping you master the art of “Trading & Investment”. Trade, Invest and get rewarded to Learn everything about ‘Investments’ the fun-filled way.

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