Financing is a skill that should learn by everyone. The management of finance is about taking good care of the money for investment, savings, and putting it in the right place. Based on invertopedia.com, finance is a broad term that describes activities associated with banking, leverage or debt, credit, capital markets, funds, and investments. The main resource for it is money and this revolves around it.
Finance literacy is another term associated with savings and credits. It is about knowledge and education in handling finances effectively for long-term purposes. This involves one's knowledge of finance, and the other one is the application of it for the purpose of financial stability. The use of resources. This kind of knowledge is allowing citizens to be mindful before entering a decision that involves money.
However, in the time of the pandemic, financial resources and stability challenge the capacity of individuals. As savings and credits are part of the financing, they are among the hardest hit. Savings means the money you are able to keep from your salary, profit, and anything from your daily finances. Credits are about borrowing or lending money from someone either in a bank or cooperative and to someone's own money that is payable for a certain time based on an agreement. This is why it is relevant to the country for the past year due to the uncertainty caused by the pandemic.
The pandemic has brought so many challenges for many people across the globe, they are losing their jobs, selling their property, and many more. Savings are spent on daily needs, and many decide to lend and borrow money from banks. People engage in loans so that they can have money that can be used for daily necessities and can be used for business purposes as a new form of income source.
Based on statistics from statista.com, during the last quarter of 2021, banks received the highest trusted savings institute with about 68.9 percent. This showed that banks are most reliable when it comes to savings. The most preferred by many and can give assurance that money is safe and not a scam. Money borrowers are trusted to lend money in banks. During this time, it increases due to a lack of jobs and works for sustaining the needs of every citizen. Through BSP, banks extend their help to lenders, especially in this crisis. Small business owners are one of those that do loans for the continuity of their business, which helps them to earn money for daily survival.
This time, finance literacy is very important. Lenders and borrowers should be mindful in choosing where to borrow money and to budget everything of the money being borrowed. Before that, they have to be mindful as well and think twice if they really need to borrow money or not. Even people who save money have to decide on the right bank where their money is secured. The country's challenge right now is sources, and money is a problem. People have two options: use their savings, if they have any, and credit money. However, thinking about credit is very not the best idea because of a hard life, how can someone pay for it if they have not worked? Choosing to lend is their option. Luckily many cooperatives and banks offer low-interest loans suited and can afford by lenders, especially with the pandemic that is still happening in the country.
The development of financial literacy is very important. Addressing this by the government is necessary. Policies are being made into simple citizens undergoing loans and lending. Educate every citizen on how to handle finances and smart decision-making when it comes to saving and credit. Young people have to armor at a young age the importance of financial education for them to acquire capabilities and stability sooner they engage in financing money on their own.
Summing up, financial education is necessary for everyone. This is a great skill to be learned at a young age. Savings is the best to be ready for any financial adversity. People have a source of funds for their daily needs and necessity. Even can result in a more adaptable person during a crisis because money is important. However, credit is optional if no choice for a source of funds, yet choosing the right cooperative or bank is a must for quality lend, like a low-interest rate. Saving and credit is about money. Finance literacy is being mindful of money. Through the application, we can avoid uncertainty in finance once we experience again another pandemic or crisis, instead, people are more financially ready what ever challenged them in terms of money.