Relationship between Subjective Financial Knowledge and Financial Well-Being: The Mediating Role of the Financial Executive Function

Abstract

This research aimed to examine the mediating role of financial executive function in the relationship between subjective financial knowledge or self-confidence in one's financial knowledge and financial well-being. A quantitative design was used, with a descriptive and correlational scope. The scales of subjective financial knowledge, financial well-being and financial executive function was applied to 554 university students from Temuco, Chile. The results show that subjective financial knowledge has an indirect effect on the financial control dimension of Financial Well-being, mediated by organization and planning of the executive function scale. Likewise, it was found that subjective financial knowledge had an indirect effect on the dimension of having financial stress through the planning dimension of the executive function scale. It is concluded that it is important to strengthen organization and planning to improve financial well-being, which could be done from an intervention based on financial literacy.