Evaluating the effects of sociodemographic characteristics and financial education on saving behavior

Abstract

PurposeThe objective of this study is to explore the effects of financial literacy level and risk aversion on the saving behavior. The literature review showed dialectical results. Therefore, this study attempts to clarify the debatable of these results by studying the mediating effect of risk aversion on the relationships between demographics determinants and saving behavior moderated by the effect of the financial literacy level.Design/methodology/approachThe data were collected from the University of Normandy; the study sample included 516 respondents representing different segments of French households. The structural equation analysis was utilized to control the impact of financial literacy as a moderate variable and the risk aversion as a mediator variable among the link between sociodemographic factors and saving behavior.FindingsThe results demonstrated that there were significant effects of demographics factors on risk aversion. Moreover, financial literacy moderates the relationships between risk aversion and saving behavior.Research limitations/implicationsThe major limitation of this research is the small size of the study sample. This paper is restricted to French households. Future financial education training should cover the European context.Practical implicationsThis study provides further evidence that financial literacy should be considered an important factor for improving household well-being. The paper encourages governments and financial institutions to create a national financial education program.Originality/valueThis paper is the first attempt to employ a sample of low-income households after financial education training in the French context.

Financial Risk Tolerance Analysis of Indonesian Retail Investors

“…Thus it can be said that the character of respondents in this study tends to have risk-averse behavior for those who are young, and more and more to take risks for those who are elderly. This is finding in line with research by Amari et al (2020) where risk behavior has a higher risk for those aged around 55 years and over.…”

“…Based on existing research, this research will examine the effect of risk capacity on financial risk tolerance, with the initial assumption that someone with a high-risk capacity has a high-risk tolerance, and someone with a low-risk capacity has a low-risk tolerance or vice versa. Thus, the hypothesis proposed is as follows: The influence of economic and demographic variables on risk attitudes has been documented before, finding that risk attitudes decrease as age increases (Amari et al, 2020), and lower risk attitudes for women than men (Trautmann & van de Kuilen, 2018). Kannadhasan (2015) tested the risk attitude (financial risk behavior) on sociodemographic factors, namely gender, age, occupation, and income.…”

“…This emphasizes the need for women to be educated to enable them to use risk wisely in ensuring adequate results to meet their financial needs. Risk attitude has also been investigated for sociodemographic variables, namely marital status, but the relationship with marital status is more controversial and the literature has not reached a uniform result (Amari et al, 2020).…”

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“…Contrary to women, men earn more in general and thus tend to be wealthier and have more savings (Amari et al, 2020). Vivel-Búa et al (2019) proved that income plays an important role in financial planning for retirement and the effect of gender is related to the income stratum to which an individual belongs.…”

Perilaku Keuangan Individu Muslim Indonesia: Studi Data IFLS5

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