EFFECT OF FINANCIAL LITERACY ON FINANCIAL WELLBEING OF NEPALESE HOUSEHOLDS

Abstract

This study has two main objectives. First, it aims to thoroughly examine the complex relationships between various financial dimensions such as financial awareness, experience, skill, behavior, knowledge, and attitude and the overall financial well-being of Nepalese households. Second, it seeks to evaluate the impact of each of these financial dimensions on the households' financial well-being. The research employs a causal-comparative design to investigate these relationships, using a sample of 384 respondents selected through a well-structured questionnaire, which was the primary tool for collecting data. The analysis of the collected data revealed that several financial dimensions, including financial knowledge, skill, attitude, awareness, and experience, have positive and statistically significant relationships with the financial well-being of Nepalese households. Notably, financial knowledge, behavior, attitude, awareness, and experience all have a positive and significant impact on financial well-being. However, while financial skill is positively related to well-being, its impact is not statistically significant.