What does financial literacy encompass?

Financial literacy encompasses a broad array of skills and knowledge crucial for making informed financial decisions. It includes the ability to understand and implement financial skills effectively, which means grasping concepts related to budgeting, investing, saving, understanding credit, retirement planning, and much more.

This comprehensive understanding enables individuals to navigate their personal finances competently, plan for the future, and achieve financial goals. The emphasis is on a holistic grasp of financial concepts that aid in everyday decision-making, rather than narrowing it down to specific areas.

Focusing solely on reading financial statements would limit one's understanding of the entire financial landscape. Likewise, the notion of being capable of saving money without any spending overlooks the essential aspects of managing expenses and income, which is a critical component of financial literacy. Lastly, understanding cryptocurrency investments exclusively fails to capture the broader financial knowledge required in today's diverse financial environments.