The effect of financial literacy and gender on retirement planning among young adults

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Osvaldo García Mata
Keyword(s):  
Young Adults ◽  
Financial Literacy ◽  
Structural Equation ◽  
Structural Equation Models ◽  
Retirement Planning ◽  
Financial Inclusion ◽  
Financial Behavior ◽  
Moderator Variable ◽  
Content Type ◽  
And Gender

PurposeThe purpose of this paper is to analyze financial literacy's effect on retirement planning among young adults in Mexico, with gender as a moderator variable. Planning refers to the actual or intended implementation of several retirement strategies: private pension funds, investing in assets, government subsidies and family assistance.Design/methodology/approachThe article's methodology is quantitative, empirical and cross-sectional. Ajzen's theory of planned behavior (1991) works as the theoretical framework to examine planning for retirement intentions determined by individuals' financial inclusion, attitudes, knowledge, behavior, occupation and family traits. The methodology follows generalized structural equation models (GSEM) with logistic regression basis, constructed with data from the National Survey on Financial Inclusion 2018.FindingsResults confirm that the most financially knowledgeable individuals have lesser intentions to pursue passive strategies, while financial behavior and inclusion associate with actively planning. Gender plays a fundamental role in retirement planning too.Research limitations/implicationsObservations for several years are necessary to effectuate longitudinal analysis. Further research should include a more in-depth study of strategy choice triggers and policy impact on retirement planning.Social implicationsFindings can be useful to public and private institutions focused on saving, investment and retirement, especially in economies comparable to Mexico's. Avoiding the higher social costs associated with poor retirement planning depends on timely decision-making.Originality/valueThis study goes beyond the traditional pension fund strategy to analyze other options. It delivers information about young people's long-term financial plans in Mexico concerning financial literacy and gender.

Financial self-efficacy: a determinant of financial inclusion

2017 ◽  
Vol 35 (3) ◽  
pp. 338-353 ◽  
Author(s):  
Rachel Mindra ◽  
Musa Moya ◽  
Linda Tia Zuze ◽  
Odongo Kodongo
Keyword(s):  
Financial Services ◽  
Self Efficacy ◽  
Structural Equation ◽  
Structural Equation Models ◽  
Service Providers ◽  
Financial Service ◽  
Financial Inclusion ◽  
Financial Behavior ◽  
Cross Sectional ◽  
Content Type

Purpose The purpose of this paper is to examine the relationship between financial self-efficacy (FSE) and financial inclusion (FI) among individual financial consumers in Uganda. Design/methodology/approach Using a quantitative approach and cross-sectional research design, a sample of 400 individuals from urban Central and rural Northern Uganda was drawn. SPSS and AMOS™ 21, regression analysis and structural equation models were used to establish the hypothesized relationship between FSE and FI. Findings The results suggest a strong positive and significant relationship between FSE and FI. The results further suggest that other variables which were controlled for, such as age and gender, had significant influence on an individual’s usage of formal financial services. Research limitations/implications The study was assessed using both potential and actual consumers of financial services collectively. However, if separately assessed, possibly there would be a variation in behavioral responses toward FI. Practical implications Formal financial service providers need to enhance individuals’ levels of confidence in management of finances and utilization of formal financial products and services, so that the financial consumers can realize the changes in financial behavior and consequently FI. Social implications The enhancement of individuals’ level of confidence in evaluating the available financial service options will guide them to take financial decisions that will improve their livelihood. Originality/value The results contribute toward the limited empirical and theoretical evidence for FSE and FI from a behavioral demand-side perspective.

Financial self-efficacy: a mediator in advancing financial inclusion

2017 ◽  
Vol 36 (2) ◽  
pp. 128-149 ◽  
Author(s):  
Rachel Mindra ◽  
Musa Moya
Keyword(s):  
Financial Literacy ◽  
Financial Services ◽  
Self Efficacy ◽  
Structural Equation ◽  
Structural Equation Models ◽  
Financial Inclusion ◽  
Mediating Effect ◽  
Mediation Effects ◽  
Content Type ◽  
The Relationship

Purpose The purpose of this paper is to examine the mediating effect of financial self-efficacy (FSE) on the relationship between financial attitude, financial literacy and financial inclusion (FI) among individuals in Uganda. Design/methodology/approach Using a quantitative approach and cross-sectional research design, a sample of 400 individuals from urban Central and rural Northern Uganda was drawn. Using SPSS and AMOS™ 21, structural equation models and bootstrapping methods were used to establish the hypothesized relationships and mediation effects between financial attitude, financial literacy and FI. Findings The results suggested FSE as a mediator of the relationship between financial attitude, financial literacy and FI. Further, there was a significant and insignificant relationship between financial literacy, financial attitude and FI, respectively. Research limitations/implications The study was assessed using both potential and actual consumers of financial services collectively. However if separately assessed, possibly there would be a variation in perceptions or behavioural responses towards FI. Practical implications There is a need to develop and sustain high levels of financial confidence among individuals to enable them use formal financial services. Social implications Possession of financial knowledge, skills, an evaluative judgement with high levels of financial confidence enable individuals make financial decisions that improve their integration into the formal financial system and improved welfare. Originality/value The results contribute towards the limited empirical and theoretical evidence regarding the mediating role of FSE in explaining the financial behaviour.

scholarly journals An Empirical Analysis of the Impact of Agency Banking on Financial Inclusion in Benue State, Nigeria: Implications for Economic Activities

2022 ◽  
Vol 14 (2) ◽  
pp. 75
Author(s):  
David Terfa Akighir ◽  
Tyagher Margaret ◽  
Jacob Terungwa Tyagher ◽  
Tordue Emmanuel Kpoghul
Keyword(s):  
Financial Literacy ◽  
Financial Services ◽  
Structural Equation ◽  
Structural Equation Models ◽  
Survey Design ◽  
Secondary Data ◽  
The State ◽  
Financial Inclusion ◽  
Economic Activities ◽  
The Impact

Twelve (12) out of the Twenty-three (23) local government areas (LGAs) in Benue State do not have the presence of banks over a long period of time. This situation has deprived the inhabitants of these LGAs of access to formal financial services until the advent of agency banking. This study therefore, investigates the impact of agency banking on financial inclusion and economic activities in Benue State focusing on the agency banking activities of First Bank Ltd. The study is anchored on the agency theory and it used a survey design. The study has utilized both primary and secondary data that were analyzed using descriptive statistical tools and structural equation models. Findings of the study have revealed that agency banking activities of First Bank Ltd have immensely enhanced financial inclusion and economic activities in Benue State. However, challenges such as shortages of cash, security problems, network failures, and lack of financial literacy are militating against the smooth operations of the agency banking in the State. On the basis of these findings, the study has recommended among others that, other banks operating in the State should be encouraged to venture into agency banking in the state so as to have a wider coverage of agency banking in the State. Also, government should provide security and partner with the private sector to provide national carrier communication network system to overcome the network failure challenge. Finally, banks should intensify efforts to educate the masses about the validity and potency of agency banking.

What drives working adults to be better prepared for their retirements?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Soo Ming Chua ◽  
Phaik Nie Chin
Keyword(s):  
Financial Literacy ◽  
Descriptive Analysis ◽  
Multiple Logistic Regression Analysis ◽  
Well Being ◽  
Retirement Planning ◽  
School Curriculum ◽  
Financial Behavior ◽  
Policy Makers ◽  
Content Type ◽  
Working Adults

PurposeThis study aims to understand the drivers that help working adults to be better prepared for retirement, by examining the relationship between financial literacy (FL), financial attitude (FA), financial well-being (FWB), financial behavior (FB) and retirement preparation (RP). RP includes multidimensional measures, which are retirement confidence, retirement planning, long-term financial planning and private retirement schemes (PRS) participation.Design/methodology/approachThis was a quantitative study adopting non-probability sampling with self-administered questionnaire distributed to all working adults. Descriptive analysis was used to examine the 294 useable data, and the multiple logistic regression analysis was adopted for hypothesis testing.FindingsThe empirical results show that FB is positively associated with RP and then followed by FWB on retirement confidence. Although insignificant influence is found on FL and FA, better FL and FA will still improve individuals' RP.Research limitations/implicationsThe study provides insights to working adults that practicing positive FB and good FWB will improve RP. Besides, for financial institutions, income level is the main determinant for consumers to participate in PRS; for policy makers, to incorporate financial attributes knowledge as part of the school curriculum since early school years.Originality/valueThis study is one of the few studies in Malaysia that explored FL, FA, FB and FWB on retirement planning, respectively.

Financial literacy and retirement planning in Ghana

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Emmanuel Sarpong-Kumankoma
Keyword(s):  
Low Income ◽  
Financial Literacy ◽  
Retirement Planning ◽  
Financial Behavior ◽  
Vulnerable Groups ◽  
Primary Data ◽  
Formal Sector ◽  
Content Type ◽  
The Impact ◽  
The Empirical Analysis

PurposeThis paper aims to investigate the impact of financial literacy on savings and retirement planning in Ghana.Design/methodology/approachThe study uses primary data collected from a sample of formal sector workers and probit models, to assess how financial literacy affects retirement planning.FindingsThe empirical analysis of this study shows that most individuals lack knowledge of basic concepts of finance. This study finds that only about 27% of respondents were able to correctly answer three simple questions on inflation, interest compounding and risk diversification. Generally, the young, the old, women, low-income earners and the less educated perform worst on financial literacy measures. Also, financial literacy has a positive significant impact on the probability of saving for retirement.Practical implicationsThe low level of financial literacy observed should be of concern to policymakers. Evidently, concrete measures are required to strengthen the knowledge of particularly those in the vulnerable groups such as the young, the old, women, low-income earners and the less educated, in order to enable them to prepare adequately for retirement.Originality/valueThe study contributes to the scant financial literacy and financial behavior literature in developing countries such as Ghana.

Development of a financial literacy model for university students

2016 ◽  
Vol 39 (3) ◽  
pp. 356-376 ◽  
Author(s):  
Ani Caroline Grigion Potrich ◽  
Kelmara Mendes Vieira ◽  
Wesley Mendes-Da-Silva
Keyword(s):  
University Students ◽  
Financial Literacy ◽  
Structural Equation ◽  
Financial Knowledge ◽  
Financial Behavior ◽  
Equation Modeling ◽  
Public And Private ◽  
Content Type ◽  
Adjusted Model

Purpose – The purpose of this paper is to build and compare models that assess university students’ financial literacy. Financial literacy, understood as the mastery of a set of knowledge, attitudes and behaviors, has assumed a fundamental role in allowing and enabling people to make responsible decisions as they strive to attain financial wellbeing. To this end, models that integrate financial knowledge, behavior and attitude are integrated. The models are subsequently estimated, and many comparative tests are performed. Design/methodology/approach – The study investigated a random sample of 534 university students attending public and private universities in southern Brazil. The choice of scale was based on consideration of the best adjustment for the Brazilian context, appropriate translation and content validation. For an analysis of the collected data, structural equation modeling was employed using two strategies. Findings – The findings indicate that, in the model estimation stage, the scales for behavior and attitude have been reduced. Among all of the models estimated, the best adjusted model indicates that financial knowledge and financial attitude have positive impacts on financial behavior. Research limitations/implications – The results are not generalizable to the wider population; to enable such generalization, different profiles should be researched using a larger sample. In practical terms, the financial behavior of Brazilian university students expresses the ability to establish long-term aims and saving aimed at future acquisitions and unexpected spending. This behavior is directly influenced by basic and advanced questions of financial knowledge and also by the importance attributed to attitude by establishing aims, control of spending and financial reserves. Originality/value – This paper describes a pioneer study with respect to modeling financial literacy in Brazil. This topic can be improved as the need for rigorous evaluation of financial literacy grows at the same speed as the creation of more complex financial products.

scholarly journals Financial literacy and personal retirement planning: a socioeconomic approach

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Kulondwa Safari ◽  
Charity Njoka ◽  
Mugisho Guershom Munkwa
Keyword(s):  
Social Security ◽  
Financial Literacy ◽  
Structural Equation ◽  
Financial Education ◽  
Retirement Planning ◽  
Developed Countries ◽  
Social Security System ◽  
Security System ◽  
Equation Modeling ◽  
Content Type

PurposeThe purpose of this study was to investigate the effect of financial literacy on personal retirement planning in Bukavu city in the Democratic Republic of the Congo (DRC), which is a Sub-Saharan underdeveloped country with a weak pension and social security system.Design/methodology/approachThis study used a structural equation modeling and a sample of 361 public sector employees selected in Bukavu city in the DRC. The data were collected through a survey questionnaire, and the data were analyzed using SPSS and SMART PLS software.FindingsThe results from the study revealed that financial literacy has a significant impact on personal retirement planning. Two constructs of financial literacy, respectively, computation capability and financial knowledge were found to have a significant impact on personal retirement planning, while financial education and attitudes toward financial products were found not significant in explaining personal retirement planning.Practical implicationsThe findings from this study can be used by policy makers in the DRC to design socioeconomic programs, aiming to increase the level of financial literacy in the country and awareness on personal retirement planning.Originality/valueThe reviewed studies were based mostly on developed countries, and countries were the social security system works effectively. We have not found a study on financial literacy and retirement planning that has been conducted in the DRC, which is a country with specific characteristics compared to developed countries.

Do the effects of individual factors on financial risk-taking behavior diversify with financial literacy?

Kybernetes ◽  
2017 ◽  
Vol 46 (10) ◽  
pp. 1706-1734 ◽  
Author(s):  
Sibel Dinç Aydemir ◽  
Selim Aren
Keyword(s):  
Locus Of Control ◽  
Risk Taking ◽  
Financial Literacy ◽  
Structural Equation Modelling ◽  
Structural Equation ◽  
Financial Risk ◽  
Financial Behavior ◽  
Individual Factors ◽  
Content Type ◽  
Equation Modelling

Purpose This study aims to examine the roles of individual factors on risky investment intention as an indicator of risky financial behavior. Design/methodology/approach The data were collected from a survey instrument and composed of 496 individuals’ responses. The authors exploited structural equation modelling and multigroup structural equation modelling for direct and indirect effects, respectively. Findings Results indicate that emotional intelligence and locus of control have a positive impact on financial risk-taking, while risk aversion in general has the negative one. Although financial literacy does not have a direct effect on risky financial behavior, it has important role as a moderator variable, interacting with external locus of control. Originality/value The authors expect this study to contribute into behavioral finance literature in two ways. First, they investigate joint and relative effects of four major factors (i.e. emotional intelligence, locus of control, risk aversion in general and financial literacy) identified in the literature on financial risk-taking of individual investors. Each belongs to a different venue in an individual’s psyche and therefore is expected to influence financial risk-taking through different mechanisms. However, the research arguing their roles on the financial risky behavior directly is very limited. Investigating their individual effects is likely to provide unique insights into our understanding of risky financial behavior. Second, the authors also posit and manifest that the effects of the first three of the aforementioned factors on risk-taking intentions are moderated by financial literacy. This finding is likely to provide rather valuable insights pertaining to the emergence of risk-taking behaviors and may shed light on the root reasons behind equivocal findings in previous research regarding the effect of each factor.

Volition to transfer: mastering obstacles in training transfer

2017 ◽  
Vol 46 (4) ◽  
pp. 809-823 ◽  
Author(s):  
Christian Seiberling ◽  
Simone Kauffeld
Keyword(s):  
Structural Equation ◽  
Transfer Of Training ◽  
Structural Equation Models ◽  
Training Transfer ◽  
Bootstrap Analysis ◽  
Content Type ◽  
Confirmatory Factor ◽  
Motivation To Transfer ◽  
Practical Implications

Purpose The purpose of this paper is to seek a better understanding of the role of volition in the learning transfer system beyond the well-established concept of motivation to transfer. Design/methodology/approach Participants of a two-day leadership training were asked to complete two online questionnaires (t1 directly after training, t2 eight weeks after training). In total, 891 managers answered the first questionnaire, 465 the second. Findings Confirmatory factor analysis suggests that motivation and volition to transfer are perceived as two different constructs. Hierarchical linear regression shows that additional variance in training transfer can be explained when volition to transfer is taken into account. Structural equation models and bootstrap analysis suggest that both motivation and volition to transfer mediate effects of supervisor support and trainer performance on training transfer. Research limitations/implications The results imply that besides motivation to transfer, volition to transfer may be a relevant construct in the transfer of training. It remains to be tested how far these findings can be generalized to other training settings beside leadership trainings. Practical implications Organizations aiming at improving training transfer should focus on enhancing the participants’ motivation and volition to transfer. Both trainers and supervisors seem to promote transfer of training by influencing a trainee’s motivation to transfer and volition to transfer. Originality/value To the authors’ knowledge, this is the first study to systematically examine the role of volition in training transfer.

Understanding destination evangelism: a social media viewpoint

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Purvendu Sharma
Keyword(s):  
Social Media ◽  
Information Seeking ◽  
Structural Equation ◽  
Structural Equation Models ◽  
Critical Role ◽  
Content Type ◽  
Mediating Role ◽  
Information Seeking Behaviors ◽  
Role Of Information

PurposeThe present research aims to introduce and understand the promising nature of destination evangelism in the context of social media-based tourism communities (SMTCs). Further, factors that influence evangelism and information-seeking behaviors on SMTCs are examined.Design/methodology/approachA conceptual model is developed that features an interplay of destination distinctiveness, destination evangelism, travel commitment and information-seeking engagement. Data were collected from 215 active users of SMTCs and analyzed using structural equation models.FindingsThe research findings indicate that destination distinctiveness and information-seeking positively lead to destination evangelism. Information-seeking is found to mediate the relationship between (1) destination evangelism and travel commitment and (2) destination evangelism and distinctiveness.Research limitations/implicationsThe research offers meaningful insights into exploring constituents of destination evangelism. The research also understands and highlights the critical role of information-seeking engagement about distinct destinations.Practical implicationsThis research highlights key areas to build, improve and inspire destination evangelism on SMTCs.Originality/valueThis study offers a fresh contribution to tourism literature by investigating destination evangelism and its drivers. This is explained by closely uniting vital research streams of evangelism, tourism and engagement. It further highlights the dual mediating role of information seeking, suggesting that these engagements are critical to evangelizing destinations.

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