Women’s Financial Literacy: Perceived Financial Knowledge and Its Impact on Money Management

Vincent Gunawan, Vera Intanie Dewi, Triyana Iskandarsyah, Irsanti Hasyim


This paper presents an empirical study on women’s financial literacy in a developing country, Indonesia. Financial literacy in developing countries, especially for women, needs to be improved. Traditionally, women have an important role in managing family finances. Their ability to conduct good financial management can help their family’s financial stability and improve its welfare. If women do not have adequate capacity to manage the family’s finances, the family’s economic health can be at risk. Having financial literacy is important as it provides financial resilience at times of uncertainty. This explanatory research uses a sample comprising 100 women living in the city of Bandung, Indonesia, who are in the Baby Boomer generation as well as in Generations X, Y, and Z. The data were collected through an online questionnaire and analyzed using partial least squares structural equation modeling (PLS-SEM). The results provide evidence that perceived financial knowledge has a significant effect on financial management behavior in the dimensions of savings behavior, shopping behavior, long-term planning, and short-term planning. Moreover, the study results show that the respondents have a moderate level of financial literacy and financial management behavior.


financial literacy; financial knowledge; financial behavior; savings behavior; shopping behavior

Full Text:



Adiputra, IG & Patricia, E 2020, ‘The effect of financial attitude, financial knowledge, and income on financial management behavior’, Proceedings of the Tarumanagara International Conference on the Applications of Social Sciences and Humanities (TICASH 2019) (pp. 107-112), Atlantis Press. doi: https://dx.doi.org/10.2991/assehr.k.200515.019.

Al-Bahrani, A, Buser, W, & Patel, D 2020, ‘Early causes of financial disquiet and the gender gap in financial literacy: evidence from college students in the Southeastern United States’, Journal of Family and Economic Issues, vol. 41, no. 3, pp. 558-571. doi: https://doi.org/10.1007/s10834-020-09670-3.

Allgood, S & Walstad, W 2011, ‘The effects of perceived and actual financial knowledge on credit card behavior’, Networks Financial Institute Working Paper, 2011-WP-15. viewed 20 October 2020, https://www.indstate.edu/business/sites/business.indstate.edu/files/Docs/2011-WP-15_Walstad_Allgood.pdf.

Allgood, S & Walstad, WB 2016, ‘The effects of perceived and actual financial literacy on financial behaviors’, Economic Inquiry, vol. 54, no. 1, pp. 675-697. doi: https://doi.org/10.1111/ecin.12255.

Amari, M, Salhi, B, & Jarboui, A 2020, ‘Evaluating the effects of sociodemographic characteristics and financial education on saving behavior’, International Journal of Sociology and Social Policy, vol. 40, no. 11/12, pp. 1423-1438. doi: https://doi.org/10.1108/IJSSP-03-2020-0048.

Anisa, NA, Arifin, S, Setyowati, L, Hidayah, N, & Megasari, AD 2020, ‘Financial literacy on impulsive buying behavior in y generation’, Quantitative Economics and Management Studies, vol. 1, no. 1, pp. 70-75. doi: https://doi.org/10.35877/454RI.qems80.

Asandimitra, N & Kautsar, A 2019, ‘The influence of financial information, financial self efficacy, and emotional intelligence to financial management behavior of female lecturer’, Humanities & Social Sciences Reviews, vol. 7, no. 6, pp. 1112-1124. doi: https://doi.org/10.18510/hssr.2019.76160.

Cohen, J 1988, Statistical power analysis for the behavioral sciences (2nd edition), Lawrence Erlbaum Associates.

Cole, S, Sampson, T, & Zia, B 2011, ‘Prices or knowledge? What drives demand for financial services in emerging markets?’, The Journal of Finance, vol. 66, no. 6, pp. 1933-1967. doi: https://doi.org/10.1111/j.1540-6261.2011.01696.x.

Dewi, VI, Febrian, E, Effendi, N, Anwar, M, & Nidar, SR 2020, ‘Financial literacy and its variables: The evidence from Indonesia’, Economics & Sociology, vol. 13, no. 3, pp. 133-154. doi: doi:10.14254/2071-789X.2020/13-3/9.

Gedela, SPR 2012, ‘Determinants of saving behaviour in rural and tribal households: An empirical analysis of Visakhapatnam District’, International Journal of Research in Social Sciences, vol. 2, no. 3, pp. 108-128.

Hair Jr, JF, Hult, GTM, Ringle, C, & Sarstedt, M 2016, A primer on partial least squares structural equation modeling (PLS-SEM), Sage publications.

Henager, R & Cude, BJ 2016, ‘Financial literacy and long and short-term financial behavior in different age groups’, Journal of Financial Counseling and Planning, vol. 27, no. 1, pp. 3-19.

Hira, TK & Mugenda, O 2000, ‘Gender differences in financial perceptions, behaviors and satisfaction’, Journal of Financial Planning, vol. 13, no. 2, pp. 86-93.

Jamal, AAA, Ramlan, WK, Mohidin, ZOR, & Osman, Z 2016, ‘Determinants of savings behavior among university students in Sabah, Malaysia’, International Journal of Accounting, Finance and Business, vol. 1, no. 1, pp. 24-37.

Kieschnick, DAH 2006, Financial knowledge levels and savings behaviors of Bermudian high school seniors at CedarBridge Academy, (Master’s thesis), Iowa State University.

Klapper, L & Lusardi, A 2020, ‘Financial literacy and financial resilience: Evidence from around the world’, Financial Management, vol. 49, no. 3, pp. 589-614. doi: https://doi.org/10.1111/fima.12283.

Klapper, L., Lusardi, A. & van Oudheusden, P. (2015) Financial literacy around the world. Standard & Poor’s Ratings Services Global Financial Literacy Survey. Washington DC: Standard & Poor’s.

Koomson, I, Villano, RA, & Hadley, D 2021, ‘Accelerating the impact of financial literacy training programmes on household consumption by empowering women’, Applied Economics, vol. 53, no. 29, pp. 1-18. doi: https://doi.org/10.1080/00036846.2021.1878093.

Kumar, S, Tomar, S, & Verma, D 2019, ‘Women’s financial planning for retirement: Systematic literature review and future research agenda’, International Journal of Bank Marketing, vol. 37, no. 1, pp. 120-141. doi: https://doi.org/10.1108/IJBM-08-2017-0165.

Lind, T, Ahmed, A, Skagerlund, K, Strömbäck, C, Västfjäll, D, & Tinghög, G 2020, ‘Competence, confidence, and gender: The role of objective and subjective financial knowledge in household finance’, Journal of Family and Economic Issues, vol. 41, pp. 626-638. doi: https://doi.org/10.1007/s10834-020-09678-9.

Lusardi, A & Mitchell, OS 2014, ‘The economic importance of financial literacy: Theory and evidence’, Journal of Economic Literature, vol. 52, no. 1, pp.5-44. doi: 10.1257/jel.52.1.5.

Lusardi, A, Mitchell, OS, & Curto, V 2010, ‘Financial literacy among the young’, Journal of Consumer Affairs, vol. 44, no. 2, pp. 358-380. doi: https://doi.org/10.1111/j.1745-6606.2010.01173.x.

Mastercard Newsroom 2019, Mastercard index of women entrepreneurs 2019. viewed 23 April 2020, https://newsroom.mastercard.com/wp-content/uploads/2019/11/Mastercard-Index-of-Women-Entrepreneurs-2019.pdf.

Morgan, PJ & Long, TQ 2020, ‘Financial literacy, financial inclusion, and savings behavior in Laos’, Journal of Asian Economics, vol. 68, p. 101197. doi: https://doi.org/10.1016/j.asieco.2020.101197.

Morgan, PJ & Trinh, LQ 2017, ‘Determinants and impacts of financial literacy in Cambodia and Viet Nam’, ADBI Working Paper, 754, Asian Development Bank Institute. viewed 20 May 2020, https://www.adb.org/publications/determinants-and-impacts-financial-literacy-cambodia-and-viet-nam.

Mountain, TP, Kim, N, Serido, J, & Shim, S 2021, ‘Does type of financial learning matter for young adults’ objective financial knowledge and financial behaviors? A longitudinal and mediation analysis’, Journal of Family and Economic Issues, vol. 42, no. 1, pp. 113-132. doi: https://doi.org/10.1007/s10834-020-09689-6.

Mukong, A, Shiwayu, N, & Kaulihowa, T 2020, ‘A decomposition of the gender gap in financial inclusion: Evidence from Namibia’, African Journal of Business and Economic Research, vol. 15, no. 4, pp. 149-169. doi: https://doi.org/10.31920/1750-4562/2020/v15n4a7.

Nanziri, LE & Olckers, M 2019, ‘Financial literacy in South Africa’, SALDRU Working Paper Series 242 - NIDS Discussion Paper 2019/9 - Version 1, Southern Africa Labour and Development Research Unit - National Income Dynamics Study.

Nguyen, TAN, Rózsa, Z, Belás, J, & Belásová, L’ 2017, ‘The effects of perceived and actual financial knowledge on regular personal savings: Case of Vietnam’, Journal of International Studies, vol. 10, no. 2, pp. 278-291. doi:10.14254/2071-8330.2017/10-2/19.

Nusron, LA, Wahidiyah, M, & Budiarto, DS 2018, ‘Antecedent factors of financial management behavior: An empirical research based on education’, KnE Social Sciences - International Conference on Economics, Business and Economic Education 2018 (ICE-BEES 2018), pp. 437-445. doi: https://doi.org/10.18502/kss.v3i10.3146.

OECD/INFE 2016, OECD/INFE international survey of adult financial literacy competencies, Organisation for Economic Co-operation and Development/International Network on Financial Education. viewed 20 July 2020, https://www.oecd.org/finance/oecd-infe-survey-adult-financialliteracy-competencies.htm.

OECD/INFE 2020, OECD/INFE 2020 international survey of adult financial literacy, Organisation for Economic Co-operation and Development/International Network on Financial Education. viewed 20 July 2020, https://www.oecd.org/financial/education/oecd-infe-2020-international-survey-of-adult-financial-literacy.pdf.

Potrich, ACG & Vieira, KM 2018, ‘Demystifying financial literacy: A behavioral perspective analysis’, Management Research Review, vol. 41, no. 9, pp. 1047-1068. doi: https://doi.org/10.1108/MRR-08-2017-0263.

Rai, K, Dua, S, & Yadav, M 2019, ‘Association of financial attitude, financial behaviour and financial knowledge towards financial literacy: A structural equation modeling approach’, FIIB Business Review, vol. 8, no. 1, pp. 51-60. doi: https://doi.org/10.1177/2319714519826651.

Ramalho, TB & Forte, D 2019, ‘Financial literacy in Brazil–do knowledge and self-confidence relate with behavior?’, RAUSP Management Journal, vol. 54, no. 1, pp. 77-95. doi: https://doi.org/10.1108/RAUSP-04-2018-0008.

Rink, U, Walle, Y, & Klasen, S 2019, ‘The financial literacy gender gap and the role of culture’, Courant Research Centre: Poverty, Equity and Growth Discussion Paper, 176, Courant Research Centre PEG, Georg-August-Universität Göttingen. viewed 5 August 2020, http://www2.vwl.wiso.uni-goettingen.de/courant-papers/CRC-PEG_DP_176.pdf.

Robb, CA & Woodyard, AS 2011, ‘Financial knowledge and best practice behavior’, Journal of Financial Counseling and Planning, vol. 22, no. 1, pp. 60-70.

Sahadeo, C 2018, Financial literacy and money script: A Caribbean perspective, Springer Books.

Santini, FDO, Ladeira, WJ, Mette, FMB, & Ponchio, MC 2019, ‘The antecedents and consequences of financial literacy: a meta-analysis’, International Journal of Bank Marketing, vol. 37, no. 6, pp. 1462-1479. doi: https://doi.org/10.1108/IJBM-10-2018-0281.

Sharma, M & Kota, HB 2019, ‘The role of working women in investment decision making in the family in India’, Australasian Accounting, Business and Finance Journal, vol. 13, no. 3, pp. 91-110. doi: http://dx.doi.org/10.14453/aabfj.v13i3.6.

Swiecka, B, Yesildag, E, Özen, E, & Grima, S 2020, ‘Financial literacy: The case of Poland’, Sustainability, vol. 12, no. 2, p. 700. doi: https://doi.org/10.3390/su12020700.

Tuong, V & Doan, MD 2020, ‘The correlation between financial literacy and personal saving behavior in Vietnam’, Asian Economic and Financial Review, vol. 10, no. 6, pp. 590-603. doi: 10.18488/journal.aefr.2020.106.590.603.

Varcoe, K, Martin, A, Devitto, Z, & Go, C 2005, ‘Using a financial education curriculum for teens’, Journal of Financial Counseling and Planning, vol. 16, no. 1, pp. 63-71.

Wangmo, P 2018, Assessing the level and impact of financial literacy on individual saving and spending habits in Royal Institute of Management (Doctoral dissertation, RIM).

Woodyard, A 2013, ‘Measuring financial wellness’, Consumer Interests Annual (Poster Annual ACCI Conferences), vol. 59. viewed 30 July 2020, https://www.consumerinterests.org/assets/docs/CIA/CIA2013/Posters2013/woodyard%20-%20measuring%20financial%20wellness.pdf.

Zulaihati, S, Susanti, S, & Widyastuti, U 2020, ‘Teachers’ financial literacy: Does it impact on financial behaviour?’, Management Science Letters, vol. 10, no. 3, pp. 653-658. doi: http://dx.doi.org/10.5267/j.msl.2019.9.014.


  • There are currently no refbacks.