Financial literacy is the knowledge and understanding of financial concepts, products, services, and systems that allows individuals to make informed decisions about their own finances. It encompasses a variety of topics, from budgeting and saving to investments, taxes, and retirement planning. It also requires an understanding of basic economic concepts such as inflation, opportunity cost, risk, return, and economic cycles. Being financially literate can help people manage their money more effectively, plan for the future, and make sound financial decisions.