Enhancing Financial Literacy: Optimising Investment Behaviour and Patterns

Abstract

Budgeting, investing, and personal financial management are financial skills that can be effectively understood and practiced with financial literacy. The study investigates the link between Financial Literacy (FL) and investment patterns, focusing on how the understanding of respondent’s financial management affects their investment decisions. Conducted in Gujarat using primary data collected through a carefully designed questionnaire and convenience sampling, the research explores the impact of respondents’ FL on their investment patterns and decision-making practices. The findings reveal a significant correlation between FL and investment behaviour. Higher FL is associated with more informed investment choices and more strategic investment patterns. This underscores the importance of financial education in shaping how people manage their investments. The results have important implications for both governmental and private finance institutions. They highlight the need for targeted FL programs and seminars aimed at improving individuals’ understanding of financial management. By fostering greater financial literacy, these programs can help individuals make better investment decisions, enhance their financial stability, and contribute to a more robust financial system. The study’s insights can guide the development of effective educational initiatives and support policies that promote better financial practices among the general population.

Keywords: Financial Literacy, Financial Knowledge, Financial Behaviour, Financial Attitude, Investment Behaviour, Investment Pattern

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