Influence of Life Events on the Financial Satisfaction of Individuals

Abstract

This study aims to determine the effect of financial knowledge and financial socialization on the financial satisfaction of the individuals when unexpected life events happen and to examine the mediating role of the financial stressor and financial behavior between them. The data collected from 243 respondents who had experienced any unexpected hospitality in the state of Azad Jammu and Kashmir. Grab sampling method utilized for data collection. Confirmatory factor analysis (CFA) and Structural Equation Modeling (SEM) utilized for data analysis. Results of study reveal that: 1) financial knowledge and financial socialization have positive influence on financial satisfaction; 2) financial knowledge has positive effect on financial satisfaction with the mediating role of the financial stressor and financial behavior when an unexpected life event happens; and 3) financial socialization has positive effect on financial satisfaction with the mediating role of the financial stressor and financial behavior when an unexpected life event happened. This study provides clear insight toward the financial satisfaction of the individuals while confronting the unexpected life events. Practitioners and financial planners use this article for increasing the financial satisfaction of their customers. There is a plethora of researches conducted in different perspective except life events of individuals. This study utilized confirmatory factor analysis, which is necessary when research carried out from a different perspective.

The Influence Of Financial Stressors, Financial Behavior, Risk Tolerance, Financial Solvency, And Financial Knowledge On Financial Satisfaction Of Working Age Population

“…The dissatisfaction can be caused by various factors, such as family, friends, and relatives (McCubbin & Patterson, 1983), or social status (Hayhoe et al, 2000) affecting the psychological and physical health of individuals (Northern et al, 2010;Kim & Garman, 2003). In addition, Ali et al (2019) suggest that financial stressors can also affect individuals' family life (Ali et al, 2019). Joo and Grable (2004) explain that measurement of financial stressors requires evaluation of three dimensions, namely (1) personal stressors: investment loss, accident, illness, wage cuts; (2) family stressors: marital status, retirement, birth and mortality, and health; and (3) financial situations: money-related issues such as debts and mortgages.…”

“…Joo and Garman (1998) found that individuals dissatisfied with their financial condition have financial stressors. Some researchers (see, for instance, Tharp et al, 2019;Ali et al, 2019;Woodyard & Robb, 2016) also reported that financial stressors affect financial satisfaction. Hence, the hypothesis is as follows:…”

“…A plethora of research reported the influence of financial stressors, financial behavior, risk tolerance, financial solvency, and financial knowledge on financial satisfaction. Ali et al (2019) and Halim et al (2015) suggest that financial issues and conditions experienced by individual or their families (financial stressors) affect the financial situation. Furthermore, Chien and Endo (2016) explain that financial behavior plays an important role in determining individual financial satisfaction as they found that individuals properly managing their finance tend to have higher financial satisfaction.…”

“…21(3), pp. 228-237, 2021) 231 e) The influence of financial knowledge on financial satisfactionSome researchers (see, for example,Pratiwi, 2019;Ali et al, 2019;Darmawan & Pamungkas, 2019) found that financial knowledge significantly influences financial satisfaction. Hence, the hypotheses are as follows:H5: Financial knowledge has a significant influence on financial satisfaction of the working-age population H6: Financial stressors, financial behavior, risk tolerance, financial solvency, financial knowledge simultaneously have a significant influence on financial satisfaction of the working-age population.…”

Economic Welfare and Subjective Assessments of Financial Situation of European Households

“…Subjective assessments in economic analyses are highlighted by Hira and Mugenda (1999), Joo and Grable (2004), and Xiao et al (2014). Subjective assessments more than the household's objective financial capacity reflect household personal finance needs (Norvilitis et al, 2003;Gerrans et al, 2014;Grzywińska Rąpca, 2018a;Ali et al, 2019). This work assumes the following research hypotheses; the first hypothesis is subjective assessments of the material situation, significantly differentiating the households of European countries, the second hypothesisa statistically significant model can be established based on which differences between the concentrations of European countries can be indicated in the context of the level of consumption and saving.…”