Perceived Financial Needs, Income Sources, and Subjective Financial Well-Being in an Emerging Market

Abstract

This study investigates perceived financial needs and subjective financial well-being using data from a national survey of 2,567 households in Turkey. Financial needs are measured by consumer perceived ability to meet current living expenses in the short-term as well as their assessment for the retirement security in the long-term. We also investigate how income sources are related to subjective financial well-being. Findings show that households' daily concerns including the inability to meet short-term expenses including healthcare, daily living expenses (food and utilities), and the inability to maintain the existing living standard are highly significant factors in explaining their subjective financial well-being. We also find that having enough income during retirement and ability to find a job in the future are positively related to subjective financial well-being. Finally, when households' incomes are from work, rental properties, family, and pension, they feel more financially secure.