Retnoningrum Hidayah

Type of the article: Research Article

Abstract
The rapid expansion of digital financial services has reshaped how young adults manage money, presenting both new opportunities and behavioral risks. Although financial literacy is widely recognized as a key driver of financial well-being, empirical evidence regarding its direct impact remains mixed. This study examines the indirect pathways through which financial literacy influences financial well-being, focusing on the mediating roles of digital financial literacy, financial capability, financial autonomy, and impulsivity.
A quantitative online survey was administered to 984 Indonesian respondents from Generation Z, and the data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The results indicate that financial literacy significantly enhances digital financial literacy, which subsequently strengthens financial capability and decision-making processes. Among all mediators, financial capability consistently emerges as the most influential pathway, whereas impulsivity does not demonstrate a meaningful mediating effect. The structural model accounts for 57.3% of the variance in financial well-being, highlighting the central role of digital competence and capability development in shaping positive financial outcomes.
The study contributes to the literature by integrating cognitive, behavioral, and psychological factors into a single explanatory framework of financial well-being among digitally active young adults. From a practical perspective, the findings underscore the need for financial education initiatives that combine foundational literacy with digital financial skills and capability-building elements. Policymakers and financial service providers in emerging economies are encouraged to strengthen accessible digital tools and targeted interventions for younger populations.

Acknowledgments
The authors acknowledge the financial support from the Institute for Research and Community Service (LPPM), Universitas Andalas, through the Flagship Research Scheme (PUJK), Batch I, Contract No. 368/UN16.19/PT.01.03/PJUK/2024. Appreciation is also extended to the Faculty of Economics and Business, Universitas Andalas, for its institutional support and facilities that contributed to the completion of this research.

Type of the article: Research Article

Abstract
This study examines the associations among behavioral biases, Investment Decision-Making, and Perceived Financial Well-Being among individual investors in Indonesia. It distinguishes respondents’ involvement in the investment decision-making process from decision quality and investment performance.
A quantitative cross-sectional design was employed using survey data from 505 Indonesian investors. The relationships among Anchoring Bias, Confirmation Bias, Loss Aversion, Overconfidence, Investment Decision-Making, and Perceived Financial Well-Being were analyzed using partial least squares structural equation modeling. Permutation-based multi-group analysis was conducted to compare female and male respondents.
Anchoring Bias, Confirmation Bias, Loss Aversion, and Overconfidence were positively associated with Investment Decision-Making, with path coefficients ranging from 0.144 to 0.215 (p < 0.05). Investment Decision-Making was positively associated with Perceived Financial Well-Being (β = 0.527, p < 0.001). The significant specific indirect effects further indicated that Investment Decision-Making statistically mediated the associations between each behavioral bias and Perceived Financial Well-Being. The multi-group analysis showed that only the relationship between Investment Decision-Making and Perceived Financial Well-Being differed significantly by gender and was stronger among female respondents.
The findings contribute to behavioral finance research by showing that behavioral biases are associated with greater self-reported involvement in evaluating, selecting, and monitoring investments. These positive associations do not indicate that behavioral biases improve decision quality, investment performance, or objective financial conditions. Given the cross-sectional and self-reported nature of the data, the findings represent statistical associations rather than causal effects.

Acknowledgment
The authors gratefully acknowledge the support provided by the Institute for Research and Community Service (Lembaga Penelitian dan Pengabdian kepada Masyarakat, LPPM), Universitas Andalas, through the Penelitian Jalur Unggulan Kepakaran research grant under Contract No. 398/UN16.19/PT.01.03/PJUK/2025. This funding played an important role in supporting the completion of this study.