THE INFLUENCE ON FINANCIAL LITERACY ON PERSONAL INVESTMENT DECISIONS

Abstract

Strategies directed towards personal investments have a considerable impact upon an individual's economic life and future life in general. But unfortunately, a good number of investors, particularly those lacking some basic knowledge of finances, incur poor investment decisions that fetch them monetary losses. Such poor decision-making is often associated with low or inadequate financial literacy that encompasses essential financial determinants like risk, return, diversification, and the time value of money. This study looks into how the level of financial literacy possessed by an individual would influence personal investment decisions by employing quantitative surveys alongside qualitative interviews. I collected relevant data from 500 survey participants. Evidence from the survey confirms the existence of financial literacy and investment success. People with a higher degree of financial literacy are bound to make well-informed, rational, and diversified investments. Furthermore, the study aspires to fill the void in available scholarly literature that focuses on understanding the impact of financial education on investment decision making. Results call for better financial literacy schemes that broadly transform the quality of financial decisions made.