SAVINGS AND INVESTMENT HABITS OF DAKSHINA KANNADA RESIDENTS: PREFERRED INSTRUMENTS, FINANCIAL GOALS, AND BARRIERS TO SAVINGS

Abstract

This study investigated the factors influencing saving and investment behaviour among Dakshina Kannada residents, aiming to identify key determinants and potential interventions to improve financial well-being. A quantitative survey approach was employed, collecting data from 100 Residents through a structured questionnaire. Principal component analysis and hypothesis testing were used to analyze the relationships between financial goals, saving/investment rates, perceived barriers, instrument preferences, and sociodemographic variables. Five distinct factors were identified: financial goals, barriers to saving, preferred instrument characteristics, financial knowledge, and financial institution access. Higher saving/investment rates were associated with specific goals like retirement planning, and negatively impacted by knowledge gaps and limited access to financial services. Income showed no direct effect, but digitalization positively influenced the adoption of modern saving/investment instruments. Financial literacy programs and improved access to financial institutions are crucial in overcoming barriers and boosting saving/investment rates, especially among low-income individuals. Tailored interventions addressing specific financial goals and knowledge gaps may further enhance financial well-being. This study provides a comprehensive understanding of saving/investment determinants in the Indian context, offering valuable insights for policymakers and financial institutions to develop targeted interventions for promoting financial inclusion and long-term financial security. Additionally, the identification of five distinct factors contributes to the theoretical understanding of saving behaviour and can inform future research in diverse economies.