Managing finances and financial literacy is crucial in today’s world, as it involves spending, investing, and ensuring everything is in order to avoid inconveniences that can often affect one’s mental health. The desire for independence is strong in the present generation, with a significant number of individuals striving to secure their financial futures. It is clear that money, or more specifically, finances, is at the center of this drive. However, beyond financial resources, the mind must also be able to evaluate and navigate financial issues effectively.
Just as becoming a good physician requires acquiring a deep understanding of diseases, symptoms, developments, and consequences in order to cure or mitigate them, the same principle applies to financial management. To achieve financial freedom, one must look back, analyze money, plan how to spend, and invest in ways that can elevate their financial standing. It takes a smart mind to succeed in this endeavor, which is why financial literacy has been introduced in universities and other educational institutions nationwide.
Teaching financial literacy is essential because it equips students with the skills necessary to manage their finances effectively. If students can manage their finances well, their lives will run smoothly, both inside and outside campus. Financial literacy helps students manage debts responsibly, encourages budgeting, saving, and investing, reduces financial stress and dropout rates, promotes long-term financial stability, and supports entrepreneurship.
Brian Tracy, an entrepreneur, once quoted, “People should find a way to offer something that people want and that is faster, better, cheaper, easier, and more convenient.” With an innovative mindset, a student can come up with business ideas through books, people, social media, and other sources, setting a solid foundation for entrepreneurial ventures.
For example, Strathmore University offers a comprehensive financial literacy program aimed at empowering Kenyan students with essential skills like budgeting and saving. In November 2023, Karatina University, in collaboration with the Equity Bank Foundation, conducted a financial literacy training at the main campus, attracting over 600 participants. The training focused on the importance of financial literacy, covering areas such as saving habits, borrowing, and budgeting.
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The government, in collaboration with higher education funding bodies, provides upkeep loans to students each semester. These funds can serve as a source of business success if utilized and planned effectively. Under the new funding model, students in need can receive up to Ksh. 30,000, paying only 5% of their fees. With the right skills, these funds can generate significant income—not only for students but also for the broader population. For instance, starting a business can cost as little as Ksh. 5,000, which is less than half the amount a student receives from these loans.
On the other hand, Old Mutual’s financial literacy program has reached over 25,000 students across 24 colleges in Kenya, and the number is expected to grow. The program allows students to interact with financial professionals, fostering a dynamic learning environment and enhancing their understanding of the power of money.
Globally, Stanford University launched a financial literacy program in November 2023. Moneythink’s peer mentorship model, founded in 2009 at the University of Chicago, has expanded to over 29 universities across the United States. Additionally, CashCourse offers campus-based financial literacy resources, providing free, non-commercial financial education in universities.
These examples demonstrate the positive impact of financial literacy programs in higher education and the importance of informed financial decision-making among university students. To achieve financial stability and freedom, one must first acquire financial skills. With practice through financial literacy training and other resources, students can improve themselves and contribute to making the world a better place.
By Joyblessed Munyendo.
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