Literacy is power and transforms lives: Channelling the relationship between financial literacy and financial satisfaction

Abstract

Anchored in the behavioral life-cycle model, the life-cycle consumption model, and the utility theory, we propose a new model that examines the channel through which financial literacy impacts on financial satisfaction. The data were gleaned with a self-administrated questionnaire from individual investors. The results disclose that financial planning mediates the relationship between financial literacy and financial satisfaction, and further, reveal that the moderating role of gender of the relationship between financial planning and financial satisfaction. Our study contributes to the frontiers of extant literature and proffers many useful practical implications and thus, from a policy perspective, our findings are crucial.