Understanding Locus of Control on Emerging Adults Financial Behavior

Abstract

This study seeks to test empirically, conceptually, and theory in terms of the Locus of control that builds financial decision behavior, where financial decision behavior will be proxied through variables economic action with the object of Department of Management Students as emerging adults. Through Purposive Sampling Technique with the target sample criteria were students of the Management Department, Faculty of Economics, State University of Medan who took the Capital Market and Financial Management Subject in the Odd Academic Year 2019/2020, 241 students met the requirements. The data analysis technique used in analyzing this study's hypothesis is Partial Least Squares -Structural Equation Modelling. Based on the results obtained, the Locus of Control Emerging Adults students of Management Department, Faculty of Economics, State University of Medan significantly affects their financial behavior.

Mediating Effect of Financial Behaviour on the Relationship Between Perceived Financial Wellbeing and Its Factors Among Low-Income Young Adults in Malaysia

“…The present study contributes to the literature by incorporating financial behaviour as a mediator between LOC and perceived FWB, which is scant in the literature. Past studies have usually examined the direct relationship between LOC and financial behaviour (e.g., Britt et al, 2013 ; Arifin et al, 2018 ; Parmitasari et al, 2020 ; Adiputra, 2021 ; Triono, 2021 ), the direct relationship between LOC and FWB, wellness or satisfaction ( Prawitz and Cohart, 2016 ; Adiputra, 2021 ) or the mediating effect of LOC on the relationship between certain antecedents and FWB or financial outcomes (e.g., Grable et al, 2015 ; Bulmash, 2016 ; Furnham and Cheng, 2017 ; Ullah and Yusheng, 2020 ; Peetz et al, 2021 ), which is in line with the study by She et al (2022) . However, the present study differs from She et al (2022) by including two important socio-demographic variables into the model, i.e., income and education.…”