The Role of Financial Literacy, Financial Confidence, and Locus of Control on Financial Well-Being, with Financial Behavior as a Mediating Variable, Among the Population of the Special Region of Yogyakarta
DOI:
https://doi.org/10.65310/19mqyb09Keywords:
Financial Behavior, Financial Confidence, Financial Literacy, Financial Well-Being, Locus of Control.Abstract
This study aims to analyze the effects of financial literacy, financial confidence, and locus of control on financial well-being, with financial behavior as a mediating variable among the productive-age population in the Special Region of Yogyakarta (DIY). The study employed a quantitative explanatory research design involving 400 respondents selected through purposive sampling. Data were collected using an online questionnaire and analyzed using Structural Equation Modeling-Partial Least Squares (SEM-PLS) with SmartPLS. The results show that financial literacy has no significant effect on either financial behavior or financial well-being. Financial confidence has a positive and significant effect on financial behavior but does not have a significant direct effect on financial well-being. Locus of control has positive and significant effects on both financial behavior and financial well-being, while financial behavior positively and significantly affects financial well-being. Financial behavior does not mediate the relationship between financial literacy and financial well-being, but fully mediates the relationship between financial confidence and financial well-being and partially mediates the relationship between locus of control and financial well-being. These findings indicate that improving financial well-being requires not only financial knowledge but also financial confidence, personal control, and consistent implementation of responsible financial behavior. The findings provide practical implications for strengthening financial well-being programs by integrating financial education with behavioral and psychological interventions.
Downloads
References
Abdallah, W., Harraf, A., Ghura, H., & Abrar, M. (2025). Financial literacy and small and medium enterprises performance: The moderating role of financial access. Journal of Financial Reporting and Accounting, 23(4), 1345–1364. https://doi.org/10.1108/JFRA-06-2024-0337
Agnew, S., & Sotardi, V. A. (2025). Family financial socialisation and its impact on financial confidence, intentions, and behaviours among New Zealand adolescents. Journal of Family and Economic Issues, 46(1), 246–258. https://doi.org/10.1007/s10834-024-09990-8
Anghel, M.-S., & Pochea, M.-M. (2025). Financial literacy and financial well-being: Empirical evidence from Romania. Borsa Istanbul Review, 100776. https://doi.org/10.1016/j.bir.2025.100776
Atlas, S. A., Lu, J., Micu, P. D., & Porto, N. (2019). Financial knowledge, confidence, credit use, and financial satisfaction. Journal of Financial Counseling and Planning, 30(2), 175–190. https://doi.org/10.1891/1052-3073.30.2.175
Bashir, I., & Qureshi, I. H. (2023). Examining theories, mediators and moderators in financial well-being literature: A systematic review and future research agenda. Qualitative Research in Organizations and Management: An International Journal, 18(4), 265–290. https://doi.org/10.1108/QROM-04-2022-2314
Bhat, S. A., Lone, U. M., SivaKumar, A., & Krishna, U. M. G. (2025). Digital financial literacy and financial well-being: Evidence from India. International Journal of Bank Marketing, 43(3), 522–548. https://doi.org/10.1108/IJBM-05-2024-0320
Brüggen, E. C., Hogreve, J., Holmlund, M., Kabadayi, S., & Löfgren, M. (2017). Financial well-being: A conceptualization and research agenda. Journal of Business Research, 79, 228–237. https://doi.org/10.1016/j.jbusres.2017.03.013
Choung, Y., Chatterjee, S., & Pak, T.-Y. (2023). Digital financial literacy and financial well-being. Finance Research Letters, 58, 104438. https://doi.org/10.1016/j.frl.2023.104438
Das, S., & Maji, S. K. (2023). Impact of financial literacy and financial confidence on the savings behaviour of the farmers: The Indian scene. Agricultural Finance Review, 83(4/5), 845–861. https://doi.org/10.1108/AFR-05-2023-0056
Fan, L., & Henager, R. (2022). A structural determinants framework for financial well-being. Journal of Family and Economic Issues, 43(2), 415–428. https://doi.org/10.1007/s10834-021-09798-w
Furrebøe, E. F., & Nyhus, E. K. (2022). Financial self-efficacy, financial literacy, and gender: A review. Journal of Consumer Affairs, 56(2), 743–765. https://doi.org/10.1111/joca.12436
García-Mata, O., & Zerón-Félix, M. (2022). A review of the theoretical foundations of financial well-being. International Review of Economics, 69(2), 145–176. https://doi.org/10.1007/s12232-022-00389-1
Garg, N., Priyadarshi, P., & Malik, A. (2024). Financial well-being: An integrated framework, operationalization, and future research agenda. Journal of Consumer Behaviour, 23(6), 3194–3212. https://doi.org/10.1002/cb.2372
Hooda, P., Singla, A., & Gupta, S. (2025). Financial capability and financial well-being among small business owners: Does grit moderate the association? Journal of Financial Services Marketing, 30(3), 17. https://doi.org/10.1057/s41264-025-00310-1
Ingale, K. K., & Paluri, R. A. (2022). Financial literacy and financial behaviour: A bibliometric analysis. Review of Behavioral Finance, 14(1), 130–154. https://doi.org/10.1108/RBF-06-2020-0141
kumparan.com. (2025). OJK DIY dorong peningkatan inklusi keuangan 91 persen di akhir 2025. Kumparan.
Lone, U. M., & Bhat, S. A. (2024). Impact of financial literacy on financial well-being: A mediational role of financial self-efficacy. Journal of Financial Services Marketing, 29(1), 122–137. https://doi.org/10.1057/s41264-022-00183-8
Mireku, K., Appiah, F., & Agana, J. A. (2023). Is there a link between financial literacy and financial behaviour? Cogent Economics & Finance, 11(1), 2188712. https://doi.org/10.1080/23322039.2023.2188712
Morris, T., Maillet, S., & Koffi, V. (2022). Financial knowledge, financial confidence and learning capacity on financial behavior: A Canadian study. Cogent Social Sciences, 8(1), 1996919. https://doi.org/10.1080/23311886.2021.1996919
Mutlu, Ü., & Özer, G. (2022). The moderator effect of financial literacy on the relationship between locus of control and financial behavior. Kybernetes, 51(3), 1114–1126. https://doi.org/10.1108/K-01-2021-0062
Otoritas Jasa Keuangan. (2025). Survei Nasional Literasi dan Inklusi Keuangan (SNLIK) 2025. OJK.
Perry, V. G., & Morris, M. D. (2005). Who is in control? The role of self-perception, knowledge, and income in explaining consumer financial behavior. Journal of Consumer Affairs, 39(2), 299–313. https://doi.org/10.1111/j.1745-6606.2005.00016.x
Phelps, N., & Metzler, A. (2025). The effects of financial knowledge, skill, and self-assessed knowledge on financial well-being, behavior, and objective situation. International Journal of Financial Studies, 13(1), 44. https://doi.org/10.3390/ijfs13010044
Rai, K., Ahuja, B. K., & Sharma, M. (2025). Exploring linkages of financial literacy with financial well-being: The mediating aspect of financial behaviour and financial self-efficacy. International Journal of Law and Management, 68(5), 834–853. https://doi.org/10.1108/IJLMA-02-2025-0066
Sabri, M. F., Anthony, M., Law, S. H., Rahim, H. A., Burhan, N. A. S., & Ithnin, M. (2024). Impact of financial behaviour on financial well-being: Evidence among young adults in Malaysia. Journal of Financial Services Marketing, 29(3), 788–807. https://doi.org/10.1057/s41264-023-00234-8
Sajid, M., Mushtaq, R., Murtaza, G., Yahiaoui, D., & Pereira, V. (2024). Financial literacy, confidence and well-being: The mediating role of financial behavior. Journal of Business Research, 182, 114791. https://doi.org/10.1016/j.jbusres.2024.114791
She, L., Rasiah, R., Turner, J. J., Guptan, V., & Sharif Nia, H. (2022). Psychological beliefs and financial well-being among working adults: The mediating role of financial behaviour. International Journal of Social Economics, 49(2), 190–209. https://doi.org/10.1108/IJSE-07-2021-0389
Song, C. L., Pan, D., Ayub, A., & Cai, B. (2023). The interplay between financial literacy, financial risk tolerance, and financial behaviour: The moderator effect of emotional intelligence. Psychology Research and Behavior Management, 16, 535–548. https://doi.org/10.2147/PRBM.S398450
Tahir, M. S. (2026). Financial literacy, financial behavior and financial resilience: The mediating role of digital financial services. China Finance Review International, 1–22. https://doi.org/10.1108/CFRI-04-2025-0245
Tulcanaza-Prieto, A. B., Cortez-Ordoñez, A., Rivera, J., & Lee, C. W. (2025). Is digital literacy a moderator variable in the relationship between financial literacy, financial inclusion, and financial well-being in the Ecuadorian context? Sustainability, 17(6), 2476. https://doi.org/10.3390/su17062476
Xiao, J. J., Ahn, S. Y., Serido, J., & Shim, S. (2014). Earlier financial literacy and later financial behaviour of college students. International Journal of Consumer Studies, 38(6), 593–601. https://doi.org/10.1111/ijcs.12122
Zhang, Y., & Chatterjee, S. (2023). Financial well-being in the United States: The roles of financial literacy and financial stress. Sustainability, 15(5), 4505. https://doi.org/10.3390/su15054505
Downloads
Published
Issue
Section
License
Copyright (c) 2026 Afriyani Indri Damayanti, Aula Ahmad Hafidh Saiful Fikri (Author)
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
