Abstract Book of the 9th International Conference on Applied Research in Management, Business and Economics
Year: 2025
DOI:
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Financial Literacy and Its Impact on Investment Decisions Among Final-Year Undergraduates in The Northern Province, Sri Lanka
Malmaruhan Inthu
ABSTRACT:
Financial literacy is a very important aspect of an individual as it shapes the individual’s financial behavior and investment decision. In Sri Lanka, much research based on final-year undergraduates proved that final-year undergraduates are expected to work in government sectors employers to provide job opportunities rather than be involved in entrepreneurship or personal investment. Therefore, this present study aims to examine the relationship between financial literacy and investment decision-making among final-year undergraduate students. In that context, the researcher used financial knowledge, financial attitude, financial behavior, and risk tolerance as independent variables of the study and investment decision-making as a dependent variable of the study. A quantitative approach is employed by the researcher using a structured Likert scale questionnaire. The researcher collected the primary data from a sample of 260 final-year undergraduates in the northern province of Sri Lanka. In that statistical analysis, the researcher used SPSS to run descriptive statistics, Pearson correlation analysis, and multiple regression analysis. The results of the study proved that financial knowledge and financial behavior are significant predictors of investment decision-making, while financial attitude showcased the moderate impact, and risk tolerance indicated to have very minimal effect on students’ willingness to invest. In that context, the key finding of the study is that still many students exhibit a preference for getting government or employers to provide job opportunities rather than actively investing in business ventures. This key finding indicated the urgent need for a financial literacy program to foster investment awareness and entrepreneurship to avoid unemployment issues. Also, the study recommends policy makers and financial institutions take encouraging steps to motivate young people to take proactive steps toward financial independence, including investing in businesses. This practice will help to generate an investment-oriented and self-reliant youth population in Sri Lanka rather than expecting jobs from the government.
keywords: Financial Literacy, Financial Knowledge, Investment Decision-Making, Risk Tolerance, Undergraduate Students