Behavior Is The Bridge: Turning Financial Attitude Into Financial Well-Being
Main Article Content
Abstract
Purpose - This paper investigates the utility of financial behavior that mediates the relationship between financial attitude and individual financial well-being. In the current world of personal finance, the information market continues to expand, making long-term financial planning one of the essential tangible outcomes of the impact of individual financial decision making. The research paper, "Behaviour is the bridge: Turning financial attitude into financial well-being" intends to establish how an attitude in itself is relevant, translated into behaviour and eventually financial well-being.
Design/methodology/approach - The structural equation modelling (SEM) was performed using the Partial Least Squares (PLS) approach and the responses received via the structured questionnaire using five items Likert scale were collected from the respondents by using primary data.
Findings - The findings suggest that the effect of financial literacy on individuals' financial well-being depends on the financial behaviours of an individual. For instance, individuals who have greater knowledge of finance tend to have more positive financial behaviour, which in turn improves their well-being.
Originality/Value: In relation to a developing economy, this particular study is a contribution since it explores the relationship between wellbeing and financial attitude, highlighting the role of financial behaviour as a mediator. Contrary to the previous studies which generally examined the constructs separately, this study applies an integrated model using PLS-SEM to identify the latent variables underlying the constructs. By focusing on the urban population of Nepal, it sheds light on aspects that are lacking in the contemporary body of academic literature by offering context-specific insights. The results have implications for creating more effective financial literacy programs and behavioral interventions in other settings where people's income is likely to grow in absolute terms.