Components Of Financial Literacy Research Articles

Determinants of financial literacy among university students: Insight into background and exposure characteristics

This article examined the level of financial literacy among university students in Ghana (N = 3932), and investigated which factors are linked with the different financial literacy components. This article is motivated by the increased drive toward financial inclusion and the critical role of financial knowledge in an increasingly sophisticated financial world. The framework used, assesses students’ knowledge in money management, savings and borrowing, investments, and insurance. The research findings show moderate knowledge in savings and borrowing but low level of knowledge in other finance issues among university students. Notably, the findings reveal that gender, work experience, subject of study, and mother’s level of education are all important determinants of financial knowledge among the students. The findings further show that students with relatively high financial knowledge are more likely to have sound judgment on financial issues; make the right financial decisions and have sound personal financial management practices. Based on the findings of the study, a national policy on financial literacy and educational programs are urgently needed as intervention to improve the level of financial knowledge of university students.

Influence of financial literacy on investment decisions of managers of small and medium enterprises in Mogadishu, Somalia

This research aimed to explore how well managers of small and medium enterprises (SMEs) in Mogadishu, Somalia, understand financial concepts such as savings, managing debt, handling financial risks, and planning for retirement, and how this understanding affects their investment decisions. The background of the study highlights that many SMEs in Mogadishu struggle to sustain their operations, with low profits or failure often due to poor investment choices. To investigate the link between financial literacy and investment decision-making among these managers, the study was based on the principles of modern portfolio theory. The research used a correlational design to analyze data from 250 targeted SMEs, with 154 respondents selected through stratified random sampling. Data collection was facilitated by questionnaires, and the analysis involved calculating means, standard deviations, and conducting regression analysis. The findings indicated that among the financial literacy components, debt management had the most significant impact on investment decisions (β=0.490, p<0.05), followed by financial risk management (β=0.137, p<0.05), and lastly, the ability to save (β=0.128, p<0.05). The study concluded that financial literacy plays a crucial role in influencing investment decisions among SME managers in Mogadishu, suggesting that improving financial knowledge could lead to better business outcomes.

The Moderating of Technological Adoption on Financial Literacy and International Entrepreneur Intention

Scholars have been and will likely remain interested in the study of entrepreneurial intention because of its importance to the development of numerous countries. The literature on entrepreneurial intention has addressed a wide range of subjects, with particular emphasis on the factors that influence entrepreneurial intention. However, the vast majority of these studies were conducted overseas. Since this topic always focuses on the agriculture sector when determining entrepreneurial purpose, the study targeted that industry. The purpose of this study is to examine the aspirations of young Malaysians to become international entrepreneurs. It especially aims to determine the relationship between each component of financial literacy (attitude, subjective norm, and perceived behavioral control) and technological adoption, as well as the effect of technological adoption on young people's ambitions to become international entrepreneurs. The study's conclusions demonstrated that financial literacy (attitude, subjective norm, and perceived behavioral control) and youth international entrepreneur intention were mediated by technology adoption. The study's findings contribute to the body of knowledge and support the executive branch and other decision-makers' creation of policies and programs. Doi: 10.28991/HEF-2024-05-01-05 Full Text: PDF

Islamic Financial Literacy, Islamic Financial Inclusion and Micro-Business Performance

This research aims to look at the role of Islamic financial literacy component in creating financial inclusion and developing micro-businesses in Indonesia. Cross sectional research design was employed in this study and data were collected from 138 micro-business located in Pekanbaru, Indonesia. The data was analyzed using path analysis and IBM SPSS 26 was adopted to testing the hypotesis. This study revealed that only two of Islamic financial literacy components positively and significant influences Islamic financial inclusion. This study also found that only one component of Islamic financial literacy positively and significantly influences micro-business performance. Other findings show a positive and significant relationship between Islamic financial inclusion and micro-business performance. This study indicates that component of Islamic financial literacy play an important role in promoting Islamic financial inclution which is necessary for growth of micro-business in Indonesia. Owner or manager of micro-business should increase their Islamic financial literacy through various training programs. This is the first study in Indonesia in investigating the role of Islamic financial litaracy on financial inclusion and micro-business development . This study has limitations in sample size and research location.

Analysis of aggregation between the components of financial literacy through inconsistency in intertemporal choices

Analysis of aggregation between the components of financial literacy through inconsistency in intertemporal choices

Gender Gaps in Financial Literacy: Evidence from Argentina, Chile and Paraguay

Understanding why women are less financially literate than men is crucial for developing effective policies that decrease gender inequalities and improve women’s financial literacy, agency, and empowerment. Accordingly, this article adopts a multidimensional approach to measuring financial literacy in developing countries, aggregating three key components of financial literacy, namely financial behavior, financial attitude, and financial knowledge. Using data from Argentina, Chile, and Paraguay, the study finds that there are statistically significant gender differences in these countries, which is confirmed, except in the case of Chile, by an extensive econometric analysis. In turn, a traditional Oaxaca–Blinder decomposition indicates, when considering the three countries as a whole, that 56 percent of the gap can be attributed to unexplained factors, while 44 percent to differences in observable characteristics, implying that men’s rates of return on human capital components, in a broad sense, are significantly different from those experienced by women. HIGHLIGHTS A comprehensive approach to financial literacy in Argentina, Chile, and Paraguay assesses gender differences in financial behavior, financial attitude, and financial knowledge. Financial literacy is relatively low across all three countries. In Argentina and Paraguay, the gender gap in financial literacy is driven by financial knowledge. Education and income are the largest contributors to the variance in financial literacy.

Exploring the demand for retirement planning advice:

This research extends previous literature on the relationship between financial literacy and financial advice seeking in three ways: (1) we examine financial planner use specifically within the context of retirement planning, (2) we incorporate Huston’s (2010) framework of financial literacy, and (3) we use longitudinal data to investigate the initiation, maintenance, and termination of financial planner use. Results from the 2010 and 2012 National Longitudinal Survey of Youth 1979 (NLSY79) show a positive association between the components of financial literacy and financial planner use for retirement planning.

FINANCIAL LITERACY AS A FACTOR IN IMPROVING THE WELL–BEING OF THE POPULATION - A REGIONAL ASPECT

<em>The article is devoted to the study of the population's financial literacy as the basis of family well-being. In modern conditions of the expansion of the use of financial services, the complexity, and the emergence of new and difficult-to-understand financial instruments, the issues of financial literacy of the population have become extremely relevant for most countries of the world. Ensuring personal financial security is becoming an important factor in people's economic well-being. The paper studies and summarizes the essence of the concept of financial literacy, highlights the main features of a financially literate person and identifies and considers the main components of financial literacy. It is shown that the role of financial literacy in Russia is sufficiently large and raising its level among citizens is an important task facing the state, the solution of which is very important both for the state and for the economy and citizens. Indicators of the level of financial literacy of the population of the Russian Federation, the dynamics of changes in the level of financial literacy of the population, and the dependence of the level of financial literacy on age have been examined and analyzed in the research.</em>

Kiến thức tài chính của sinh viên Việt Nam: Thực trạng và các vấn đề đặt ra

Financial knowledge is an important component of financial literacy for every person. Financial literacy helps people have a better life by making relevant financial decisions. To measure the financial knowledge of Vietnamese students, this study conducted a random online survey of 4,140 samples at universities across the country in 2021, with 11 questions divided into 3 levels of knowledge (basic, medium and advanced). The descriptive statistics show that Vietnamese students have very weak financial knowledge, in which, even students are studying finance-banking or economics. The results also show that financial knowledge is not uniform in different school years, regions and majors. In the context that Vietnam is implementing a comprehensive financial strategy, there is an urgent need to systematically develop a National Financial Education Strategy, to provide early education by many different channels and methods for students as well as for the youth in Vietnam

The Big Three of Financial Literacy: Analyzing its Influences on Financial Well-being

This study attempts to identify the key components of financial literacy and its constituent factors, and to examine influences of people’s financial literacy on their financial well-being. The study is mainly based on the primary data collected from 384 randomized samples from the Indian state of Assam. Data analysis was carried out using statistical techniques such as factor analysis, regression analysis, and correlation analysis. A thorough review of the empirical literature, and findings of the present study reveal three major components– "financial knowledge, financial behavior, and financial attitude" –that constitute people’s financial literacy, which are coined as “the big three of financial literacy.” Financial literacy and its three major components are found to have strong and significant influences on people’s financial well-being. It is concluded that an increase in people’s financial literacy results in an increase in their financial well-being, and vice versa

The decision to invest in securities: components of financial literacy

Annotation. Recently, individuals have increasingly shown interest in investing in securities as an alternative to deposits and investments in real estate. Private investors have a desire not only to save their savings, but also to multiply them. The impetus for this desire was the crisis caused by the COVID-19 pandemic, as a result of which many companies were forced to either suspend their activities, or transfer their employees to remote operation, or reduce wages. Despite the increasing contribution of private investors to various financial instruments, the issue of protecting their interests is acute. However, the focus of protection begins with the concept of "financial literacy". It is financial literacy that is one of the components of the country's sustainable development chain. In this regard, the purpose of the article is to assess the impact of financial literacy of an unqualified investor on his decision to purchase securities. This issue is insufficiently studied in the scientific Kazakh literature. For a more complete disclosure of the subject of the study, factors such as awareness of the stock market and the level of education of the individual are included in the circle of determinants. The practical significance of the article lies in the scientific approach to the formation of the evidence base of the issue under consideration. Within the framework of the study, null and alternative hypotheses were put forward. Verification of the relationship between these determinants was carried out through multivariate regression analysis. One-factor analysis of variance was used to carry out the relevant calculations concerning the respondents' questions regarding the share of income allocated for the purchase of stock market products. Additionally, based on the results of the conducted sociological research, a one-factor regression analysis was applied. The diversity in methodological approaches allowed a more extensive approach to the evidence base of the hypotheses put forward. The result of the study showed the influence of factors such as awareness of the stock market, financial literacy and education indicator on the level of investment in securities. The practical significance of the results of the work makes it possible to correctly select and strengthen the emphasis in the next steps in the formation of a policy to protect the interests of private investors, often classified by the stock market as unqualified investors.

Financial knowledge, attitude and behaviour components of financial literacy: a study of Indian higher education students

The present study seeks to determine the financial literacy level of Indian higher education students on the components of financial knowledge, attitude and behaviour. The paper also makes an attempt to study the interdependencies in financial literacy component: financial knowledge, attitude and behaviour and to assess the impact of financial awareness on financial literacy. This study considers primary source of data. A total sample of 600 Indian higher education students from different governmental and private institutions of Kanpur, Prayagraj and Aligarh was chosen to determine the financial literacy level. The findings of the study showed that more than half of the students were found to be low financial literate. There is a strong interrelationship found between the financial literacy components: financial knowledge, attitude and behaviour. In the linear regression analysis significant relationship found between the independent variable financial awareness and dependent variable financial literacy. The empirical findings of the study helps to explain how the financial literacy components: financial knowledge, attitude and behaviour influence the financial literacy level among the Indian higher education students. The result clearly showed that there is a need of serious policy measures to be taken in the field of financial literacy/education.

Influence of Financial Literacy on Credit Uptake by Youth Enterprises in Machakos Town, Kenya

Credit to youth undertaking small-scale businesses enables them to engage in self-employment projects with the main goal of generating income. However, credit uptake by youth is believed to be depended on and enhanced by the possession of business and entrepreneurial skills which are critical components of financial literacy. The biggest challenge to most youth is financial illiteracy which makes them lack the ability to integrate what they know with what they can do to earn a living. This study sought to examine how financial literacy influences credit uptake by youth enterprises in Machakos Town, Kenya. Specifically, the study focused on establishing the influence of bookkeeping skills, budgeting skills, debt management skills, and financial knowledge on credit uptake by youth entrepreneurs in Machakos Town, Kenya. The study employed a descriptive research design. From a target population of 1704 youth enterprises, a sample of 314 were selected randomly to participate as respondents. A structured questionnaire was used to collect data. Simple and Multiple regressions were used to test hypotheses. The regression results revealed an R2 of 0.754. This meant that holding other variables constant, financial literacy variables account for 75.4% of the variability in credit uptake by the sampled youth entrepreneurs. Generally, all the measures of financial literacy had a positive significant influence on the dependent variable. Specifically, the coefficients of bookkeeping skills, budgeting skills, debt management skills, and financial knowledge all had a p = 0.000. The findings of this study provide a guide on the policy that targets financial literacy as a critical component in enhancing self-employment by youth in Kenya.

Effect of Financial Literacy on the Performance of Women Owned SMEs in Nigeria: A Study of Awka, Nigeria

The primary aim of this research was to investigate the effect of financial literacy on the performance of selected women-owned SMEs in Awka, Anambra State. Utilizing a descriptive cross-sectional survey design, the study collected both quantitative and qualitative data, examining the impact of three specific financial literacy components: debt management literacy, budgeting skills, and book-keeping skills. Regression analyses were employed to ascertain the relationships between these financial literacy aspects and SME performance. Findings revealed a nuanced influence of financial literacy on SME performance. Notably, debt management literacy exhibited a negative yet significant relationship with SME performance, indicating challenges in effectively implementing financial knowledge. Book-keeping skills also had a negative but significant impact on SME performance, suggesting an overemphasis that might divert attention from other growth opportunities. In contrast, the effect of budgeting skills was found to be non-significant, pointing to its potential overshadowed role or regional variations in its application. Based on these outcomes, specific recommendations were posited. Women entrepreneurs are advised to undergo holistic financial training that focuses on the strategic application of knowledge, particularly in debt management. Additionally, while the importance of book-keeping remains undebated, diversifying skills to encompass other business aspects is crucial. Lastly, a renewed approach integrating traditional budgeting with local challenges is advocated to make budgeting more impactful for SMEs in Awka.

Financial Literacy in Malaysia, 2015–2018

This paper provides an overview of the state of financial literacy of Malaysians using data from the OECD (INFE) Financial Literacy Survey conducted in year 2015 and 2018. Besides the three components of financial literacy, namely, financial knowledge, financial attitude and financial behaviour, this paper also analyses the financial vulnerability of individuals. The effects of socio-demographic factors excluding gender are significant in determining financial literacy levels. Generally, Malaysians do not think that they have high financial knowledge, and the objective financial knowledge assessment reflects this as less than 40% of the respondents meet the minimum financial knowledge target score. There are no significant differences in the level of financial knowledge between 2015 and 2018 but financial attitude towards money usage worsened in 2018 compared to 2015. However, in terms of financial behaviour, Malaysians are generally active savers, set long-term financial goals, make considered and informed purchases, and keep a close watch on their personal affairs. Malaysians are financially vulnerable, but they seem more prepared in weathering the storm and having financial cushions for emergencies in 2018 compared to 2015. The findings suggest more effort is needed in educating Malaysians on fundamental financial concepts and ways to enhance their financial cushion.

Signifikansi Literasi Keuangan terhadap Pengguna Aktual Dompet Digital

The emergence of many conveniences in using digital wallets are the goal in this study, namely to determine the effect of the three components of financial literacy on the financial satisfaction of digital wallet users in Generation Z. The three components of financial literacy consist of financial behaviour, financial attitude and financial knowledge. This study uses a quantitative descriptive analysis method, with purposive sampling method for determining the population that consist of 40,000 ShopeePay Indonesia Twitter account followers and a sample of 380 ShopeePay Indonesia Twitter account followers. Data collection techniques use literature and questionnaires with Likert scale techniques. The analysis technique in this study uses multiple linear regression analysis with SPSS 24 software tools for windows. The results showed that the financial behaviour variable (X1) had no partial effect on financial satisfaction. While the variables of financial attitude (X2) and financial knowledge (X3) have partial effect on financial satisfaction. The variables of financial behaviour, financial attitude, and financial knowledge simultaneously affect the financial satisfaction of Shopeepay digital wallet users in Generation Z. Therefore, there are need a development in this research and can be used as theoretical support, especially in the financial literacy component. Keywords: financial literacy, financial behaviour, financial attitude, financial knowledge, financial satisfaction

Financial Literacy on Millenial Entrepeneurs during Pandemic Covid-19

As one of the drivers of economic success and societal welfare in Indonesia, financial literacy is a must for young entrepreneurs today. The study attemps to evaluate Millenial entrepreneurs financial literacy and financial well-being conditions while several PPKM (Restrictions on Community Activities) during Pandemic Covid-19 are in effect. Between mid-October 2021 and early January 2022, the survey used 100 young entrepreneurs aged 21-40 in West Java Province, Indonesia as samples. The hypotheses testing results from Exploratory Factor Analysis (EFA) and Structural Equation Model (SEM) methods show a consistent association between the main components of financial literacy with the level of financial well-being, with insurance and personal savings and loans becoming the dominant predictor affected financial knowledge, followed with security that serves as main determinant that affected the level of financial attitude of these millenial entrepreneurs. However, this study has limitation as the sample and number of experimental parameters are small.

The Interrelationship Between Financial Knowledge, Financial Behavior, and Financial Attitude of Undergraduate Students in Padang, West Sumatra

The purpose of this research is to evaluate the relationship between the students' demographic characteristics and their level of financial literacy, as well as the interrelationship between the three financial literacy components. All of the information was gathered by mailing questionnaires to undergraduate students in Padang, which included questions on age, gender, university, college level/semester taken, and monthly income. The questionnaire was completed by 414 people from the sample. The findings indicate that 47.57 percent of respondents correctly answered the questions on average, which is relatively low. The study also discovered that age, gender, university, college level, and monthly income have no effect on financial knowledge when using Structural Equation Modelling (SEM). Similarly, financial knowledge has no influence on financial mindset. Financial attitude and knowledge, on the other hand, have a positive relationship on financial behavior. Financial attitude, on the other hand, cannot moderate the relationship between financial knowledge and financial conduct. The implications of this research is how colleges, government institutions, and/or other NGOs work together to increase the financial literacy of the youth in the City of Padang.

Formation of Financial Literacy of Students − Future Teachers of Mathematics Through the Solution of Cases

Currently, financial literacy is recognized as a key competence. It not only allows each individual person to manage personal finances and be more protected from fraudulent actions, but also is a way to improve the financial well-being and stability of the entire state. The problems of forming financial literacy are acute at different levels of the education system. For university students − future teachers of mathematics − the issue of forming financial literacy and raising its level is not only personal in nature. It becomes the key to his future professional activity, since it is the teachers who lay the foundation for their students to form a financial culture. The purpose of this study is to identify the possibilities of using cases to form the financial literacy of future mathematics teachers in the process of studying mathematical disciplines. The methodological base is a practice-oriented approach. The paper presents one of the cases developed in the study, which can be used in higher education in the study of the discipline “Algebra”. This case uses the mathematical apparatus of the topic “Matrices and determinants” and is considered as the main tool for the formation of financial literacy of future mathematics teachers. Based on the context of the proposed case, financial literacy components were identified, acting as descriptors of basic and key competencies. The execution of the case implies the implementation of a certain plan, which can be considered as an algorithm implemented in accordance with didactic principles. The results of the work can be used in the educational process of higher educational institutions that implement programs in the pedagogical direction.

A Brief Study On Recent Trends in Financial Literacy

Financial literacy is personal financial management, credit various financing including budgeting and investment Ability to understand and use skills effectively Is. Financial literacy with money your relationship foundation its lifelong learning journey. According to financial literacy and the Education Commission, the five main components of financial literacy are: learning, spending, savings and investing, borrowing and securing. Financial literacy is learning How to manage your money. This means yours How to pay bills, borrow and make money. Saving responsibly and how and why to invest and learning to plan for retirement. Financial literacy is cognitive understanding of financial components and skills Budget, investment, borrowing, taxation and personal finance management. While the financial education umbrella comes under many skills popular examples include the home budget, learning loans How to manage and repay various loans and investment products In between include business appraisal.