Impact of Financial Literacy on individual investment decision: “A case study of J&K UT”

Abstract

Financial literacy refers to the knowledge, skills, and ability of an individual to understand financial concepts and make informed decisions regarding personal finance. The impact of financial literacy on an individual's investment decision-making is significant, as it can help individuals make informed decisions and achieve their financial goals. Individuals who are financially literate are better equipped to understand the risks and potential returns of various investment options. They can also evaluate the suitability of different investment options based on their personal financial goals, risk tolerance, and time horizon. Financially literate individuals are more likely to diversify their investment portfolios and make informed decisions about asset allocation. In addition, financial literacy can help individuals avoid costly mistakes, such as investing in high-risk investments without fully understanding the potential downside. Financially literate individuals are more likely to avoid scams and fraudulent investments, which can result in significant financial losses. Overall, financial literacy is a crucial factor in an individual's investment decision-making process. It can help individuals make informed decisions, avoid costly mistakes, and achieve their financial goals. Therefore, it is essential for individuals to invest in their financial education and improve their financial literacy. In this proposal, researcher attempts to study the factors responsible for financial literacy on individual investment decision. The study is based on descriptive and exploratory style using primary data. The primary data is collected with the help of Google forum. Pie-chart presentation is used for the purpose for analyzing the data. The result of the survey shows that there exists a positive relationship on gender, qualification and occupation with respect to financial literacy to make efficient investment decision.