THE IMPACT OF FINANCIAL LITERACY ON INVESTMENT DECISIONS: THE MEDIATING ROLE OF PEER INFLUENCE AND THE MODERATING ROLE OF FINANCIAL STATUS

Abstract

This study examines the connection between behavioral and digital financial literacy and investing choices, using social impact and financial position to explain these choices, within the Theory of Planned Behaviour. The results from a survey of 400 diverse professionals were analyzed with PLS-SEM. Both types of financial literacy appear to have a good effect on how people invest. The impact of behavioral literacy on investing is affected by financial circumstances and is partly reduced by peer impact. Improving behavioral knowledge allows you to manage your finances and plan for the future and being digitally literate encourages you to use online platforms to help with decision-making. How much impact your friends have can show subjective norms, while your economic situation reveals your perceived control over behavior, both of which support the theory. It improves our understanding of financial literacy by splitting the topic into behavioral and digital features. It supports the need for special strategies to raise digital and behavioral skills in individuals from disadvantaged groups. The next phase of research ought to look at lengthy studies and include more social-psychological variables.

Keywords: Behavioral Financial Literacy, Digital Financial Literacy, Investment Decisions, Peer Influence, Financial Position