Financial Literacy And Risk Aversion: The Influence Of Social Agents, Mindfulness, And Education In Emerging Economy

Abstract

The research examines the relationship between risk aversion and financial literacy from financial, social influencers, financial education, and mindfulness perspectives. Quantitative data was gathered from university students through an electronic self-administered survey, and the research utilized partial least squares structural equation modeling. The findings indicate a favorable relation between risk aversion, financial knowledge, and mindfulness. Financial literacy, financial social agents, and financial education are inversely related. The most significant mediating factor appears to be mindfulness, indicating that individuals with a positive mind tend to have lower levels of risk aversion along with higher financial literacy. These findings have implications for stakeholders, including users of financial institutions and regulatory bodies. As financial decisions be[1]come more complex daily, individuals require adequate financial knowledge to make informed choices. The research suggests that financial education alone may have limited effectiveness in enhancing financial behaviors, echoing prior studies highlighting the importance of considering psychological traits alongside financial literacy.