Design and Evaluation among Young Adults of a Financial Literacy Scale Focused on Key Financial Decisions

Abstract

The present study underpins the design and validation of a Financial Literacy (FL) scale in the Latin American and the Caribbean (LAC) context. Though scales are available, they do not meet contextual characteristics and seem to miss out on a focus on Key Financial Decisions (KFD). Scale design was consistent with an extensive literature review (2010–2021). Forty-four items scale covering the dimensions of Financial Attitude, Financial Behavior, and Financial Knowledge were presented to 478 young adults aged 18–30, and women 58% of them. The results reflect a robust FL scale by applying Confirmatory Factor Analysis (CFA). The data about young adults’ FL can be used as a benchmark in future studies fostering the development of FL in the Latin American and Caribbean contexts.

Keywords

• financial literacy
• financial attitude
• financial knowledge
• financial behavior
• young adults
• confirmatory factor analysis