What is the purpose of a financial literacy program?

The purpose of a financial literacy program is to educate individuals on managing finances, investing, and understanding credit. This education aims to equip people with the knowledge and skills necessary to make informed decisions regarding their financial situations. Through such programs, participants learn about budgeting, saving, debt management, and the implications of interest rates and credit scores, which can significantly impact their long-term financial health.

Understanding these concepts is essential for individuals to navigate the complexities of personal finance effectively. For example, knowledge about how to create a budget allows individuals to track their income and expenses, enabling them to make adjustments and prioritize savings. Similarly, learning about investments can help individuals grow their wealth over time, while understanding credit can empower them to maintain a good credit score and secure favorable loan terms.

The other options do not capture the primary focus of financial literacy programs. While promoting government regulations, establishing penalties, or providing funding may be components of a broader financial framework, they do not address the core goal of educating individuals to empower them in their financial decision-making.