Examining the relationship between financial literacy and personal savings among individuals in Adeiso

Abstract

The study examined the relationship between financial literacy and personal savings among individuals in Adeiso. The study used descriptive design in the quantitative approach. Stratified sampling technique was used to select 300 respondents (nurses, teachers and SME operators) in Adeiso of which questionnaires were administered to them. Furthermore, the data was analyzed with the help of statistical software known as Statistical Product for Service Solution (SPSS version 21.0) and interpreted by using percentages and frequencies and presented with the aid of tables, graphs and charts. It was found out that, generally, financial literacy of the respondents was moderate. The financial literacy level of nurses was very weak in terms of knowledge in retirement planning, investment and savings and borrowing. Teachers at Adeiso has weak knowledge in insurance and SMEs operators had weak knowledge in retirement planning and insurance. Surprisingly, all the respondents had weak knowledge in insurance. Teachers have high level of financial literacy as compared to nurses and SMEs operators. Only increment in the number of children reduces financial literacy of the respondents. Moreover, there was a positive significant relationship between sex, educational status, marital status, personal income, financial literacy and savings behavior. However, there was a weak negative relationship between age and savings behavior. The study therefore, recommends that people without business educational background such as science and humanities should be encouraged to learn more on personal financial management and others. Also, family planning methods should be encouraged among the youth in order to control the number of children of people since it affect savings negatively.