The fact that many of the things we use require money means that we need financial literacy.
We need to understand financial products and concepts; to make informed choices, to know where to go for help, and to take other effective actions to improve their financial well-being.
Even though it has never been listed among the nation’s leading killer diseases, nor is it feared like say armed conflict is; nothing and I repeat nothing, is so devastating for today’s employee, business owner, family and public leader as is the effect of financial illiteracy.
A financially illiterate person will fail to rein in their expenditures and therefore fail to make ends meet.
Such a person will think that the only way out of his or her financial predicament is to earn more money but when their income increase so will their expense balloon.
Both analysts and policy makers have lamented for years about Uganda’s low saving to GDP ratio.
This lamentation will achieve no positive effect until we address the financial illiteracy that is at the root of it. Ugandans need to learn how to be frugal and then know where to put their savings.
According to the 2011/12 budget, 80 per cent of Ugandan youth that graduate from universities and colleges cannot find jobs.
Even when the money has long moved away from jobs to businesses, our financially illiterate society continues to hold the out-dated belief that a student who gets a university degree will automatically get a good paying job.
Many times when an investor is mentioned in Uganda, that person will very likely be a non-Ugandan.
Why is this so? It is because Ugandans are largely ignorant about investing.
Whether it is within the government or at a personal level, Ugandans know a lot about spending money but are in the dark when it comes to investing.
We assign too much importance to luck and political connections. It is a very rare occurrence for people to view financial progress in terms of goal setting, persistence and hard work.
Instead, progress is often viewed through the lens of luck and being connected.
There is a growing debt epidemic among salary earners who borrow from money lenders charging 20-30 per cent interest per month.
The perpetual borrowers consistently hand over 20 per cent or more of their income to money lenders for the simple reason that they cannot postpone certain expenditures for one or two months in order to break the vicious cycle of debt.