BEHAVIORAL FINANCIAL DECISIONS OF THE POPULATION IN THE PROCESS OF CONSUMPTION

Abstract

Introduction. The financial decision-making process depends not only on objective economic factors and motives; it is often under the influence of behavioural factors and subjective perceptions of situations. Consumption, as a continuous process of acquiring goods and services, has become an integral attribute of public life and a significant item of expenditure of personal and family budgets. Therefore, understanding the behavioural effects that affect the financial behaviour of consumers is an important step towards conscious consumption and rational spending of personal funds. The purpose is to theoretical analyse the influence of behavioral factors on the financial decisions of citizens in the field of consumption in order to reduce their negative effects and optimize consumer spending. Methods. System of general scientific and special research methods were used in the article. Methods of analysis, synthesis and generalization were used for the study of literary, statistical and Internet sources on the research topic; visualization method were used for visual presentation of the processed data; abstract-logical method - for generalize the presented material and formulate conclusions. The method of questionnaires and sampling, methods of statistical analysis and comparison were used for evaluate the financial decisions of households in Ukraine. Results. The article presents that using of an “intuitive” system of making financial decisions in the process consumption leads to unconscious and irrational spending of personal funds. The author generalized theories of behavioral finance and systematized the behavioral factors that influence citizens' financial decisions, namely: heuristics, emotions, framing, market influence, psychological accounting and loss perception. It has been proven that due to the lack of time for detailed information analysis, people make decisions under the influence of heuristics, such as the bandwagon effect, possession and anchoring. In such cases, money is spent irrationally and consumption becomes unconscious, as it is stimulated by marketing technologies and manipulations. Behavioral factors of emotional influence (excessive self-confidence and greed) also push the population to unjustified financial risks. Author offer to improve state policy in the field of management of personal financial resources in way to help citizens avoid the negative impact of behavioral factors and make informed financial decisions. Perspectives. The subject of further scientific research is the search and in-depth study of ways to effectively use personal funds in the field of lending and investing in the context of behavioral theories.