00:11Central Bank Governor Larry Hawaii stressed the importance of financial literacy to secondary
00:17school students on Wednesday and advised them to invest. He was speaking at the launch of the
00:24National Financial Literacy Program's Finlit Life at the Center of Excellence, Makoya.
00:31You need to budget. You need to educate yourself about the opportunities that exist for proper
00:38investments that would give you the rate of return that you're looking for. One thing many people don't
00:47realize is the power of compound interest. Hawaii said compound interest is something that
00:54quote flies over the heads of most of us end quote. He used Warren Buffett as an example saying he
01:02is
01:02worth billions of United States dollars but started off with literally nothing. Buffett is an American
01:10investor and philanthropist who is the chairman and former chief executive officer of the conglomerate
01:16Berkshire Hathaway. What he did is he slowly invested and reinvested and reinvested and that is what
01:26compound interest is about. It is taking the income you earn whether it's in the form of interest I say
01:32compound interest but it could be in other forms dividend income and so on and you simply reinvest it
01:38and over a period of time you suddenly find that it has multiplied into a lump sum that could buy
01:48you a home,
01:49could buy you a car, could educate the next generation of young ones who come after you. So I want
01:55you to
01:55understand the very important point about compound interest. I want you to understand that financial
02:04literacy when it sounds a little complicated is really a silent superpower that will transform your
02:13lives. He encouraged students to invest saying quote investment is better than saving end quote. Hawaii
02:22explained that saving gives a small increase but there are ways to create extra earnings.
02:28stocks. Rishana Pogu for inside business.
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