International Journal of Social Science & Economic Research
Submit Paper

Title:
EFFECT OF FINANCAL LITERACY ON FINANCIAL DECISIONS AMONG WOMEN IN MOMBASA COUNTY, KENYA

Authors:
BENARD KIOKO MULI and Dr. Onesmus Mutunga Nzioka

|| ||

BENARD KIOKO MULI and Dr. Onesmus Mutunga Nzioka
University Of Nairobi, Kenya

MLA 8
MULI, BENARD KIOKO, and Dr. Onesmus Mutunga Nzioka. "EFFECT OF FINANCAL LITERACY ON FINANCIAL DECISIONS AMONG WOMEN IN MOMBASA COUNTY, KENYA." Int. j. of Social Science and Economic Research, vol. 7, no. 3, Mar. 2022, pp. 592-658, doi.org/10.46609/IJSSER.2022.v07i03.009. Accessed Mar. 2022.
APA 6
MULI, B., & Nzioka, D. (2022, March). EFFECT OF FINANCAL LITERACY ON FINANCIAL DECISIONS AMONG WOMEN IN MOMBASA COUNTY, KENYA. Int. j. of Social Science and Economic Research, 7(3), 592-658. Retrieved from doi.org/10.46609/IJSSER.2022.v07i03.009
Chicago
MULI, BENARD KIOKO, and Dr. Onesmus Mutunga Nzioka. "EFFECT OF FINANCAL LITERACY ON FINANCIAL DECISIONS AMONG WOMEN IN MOMBASA COUNTY, KENYA." Int. j. of Social Science and Economic Research 7, no. 3 (March 2022), 592-658. Accessed March, 2022. doi.org/10.46609/IJSSER.2022.v07i03.009.

References

[1]. Agarwal, S, Driscoll, J, Gabaix, X, Laibson, D. (2009). The age of reason: Financial decisions over the life-cycle with implications for regulation. Brookings papers on Economic activity, 51-117
[2]. Ali A., Umar, H. & Asifa, K. (2017). Impact of financial literacy and financial attitude on financial decisions: mediating role of financial socialization. J Manag Sci, 12(3), 1.
[3]. Allgood, S., & Walstad, W. B. (2016). The effects of perceived and actual financial literacy on financial behaviors. Economic inquiry, 54(1), 675-697.
[4]. Almenberg, J., & Säve-Söderbergh, J. (2011). Financial literacy and retirement planning in Sweden. Journal of Pension Economics & Finance, 10(4), 585-598.
[5]. Amisi M (2012). The effect of financial Literacy on Investment Decision Making by pension Fund managers in Kenya. Unpublished MSc Research Project, University of Nairobi, Nairobi Kenya.
[6]. Ansari, S., & Phatak, D. Y. (2017). A study on financial risk tolerance and preferred investment avenues of investor. International Journal of Application or Innovation In Engineering & Management (IJAIEM), 6(7), 149-155
[7]. Atakora, A. (2013). Measuring the effectiveness of financial literacy programs in Ghana.
[8]. Atkinson, A., & Messy, F. A. (2012). Measuring financial literacy: Results of the OECD/International Network on Financial Education (INFE) pilot study.
[9]. Baker. H., & Martin, G. (2011). Capital structure & corporate financial decisions. Hoboken N.J.: John Wiley & Sons.
[10]. Beck, T., Demirgüç-Kunt, A., & Levine, R. (2007). Finance, inequality and the poor. Journal of economic growth, 12(1), 27-49.
[11]. Bell C, Gorin D, Hogarth JM (2009). Does financial education affect soldiers’ financial behaviors? Networks Finance. Inst. Indian State Univ.
[12]. Bertola, G., Guiso, L., & Pistaferri, L. (2005). Uncertainty and consumer durables adjustment. The Review of Economic Studies, 72(4), 973-1007
[13]. Bhabha, J. I., Khan, S., Qureshi, Q. A., Naeem, A., & Khan, I. (2014). Impact of financial literacy on saving-investment behaviour of working women in the developing countries. Research Journal of Finance and Accounting, 13(5), 118-122.
[14]. Blumberg, B., Cooper, D., & Schindler, P. (2014). EBOOK: Business Research Methods. McGraw Hill.
[15]. Breusch, T. S., & Pagan, A. R. (1979). A simple test for heteroscedasticity and random coefficient variation. Econometrica: Journal of the econometric society, 1287-1294.
[16]. Brink, H. I. (1993). Validity and reliability in qualitative research. Curationis, 16(2), 35-38.
[17]. Bucciol, A., & Zarri, L. (2015). The shadow of the past: Financial risk taking and negative life events. Journal of Economic Psychology, 48, 1-16.
[18]. Caputo, A. (2014). Relevant information, personality traits and anchoring effect. International Journal of Management and Decision Making, 13(1), 62-76.
[19]. CBK (2015). Bank Supervision Annual report. https://www.centralbak.go.ke/
[20]. Central Bank of Kenya, Kenya National Bureau of Statistics, and Financial Sector Deepening Trust Kenya. (2016). FinAccess Household Survey (Nairobi: FinAccess).
[21]. Chari, V. V., Dovis, A., & Kehoe, P. J. (2016). Financial Repression: Evidence and Theory (No. 16-4). Federal Reserve Bank of Minneapolis.
[22]. Chavali, K., & Mohan Raj, P. (2016). Impact of demographic variables and risk tolerance on investment decisions: An empirical analysis. International journal of economics and financial issues, 6(1), 169-175
[23]. Chen, H., & Volpe, R. P. (1998). An analysis of personal financial literacy among college students. Financial services review, 7(2), 107-128.
[24]. Churchill, GA. (1991). Marketing research methodological foundations. 5th ed. Chicago. Dryden.
[25]. Curtis, G. (2004). Modern Portfolio Theory and Behavioral Finance. The Journal of Wealth Management, 7(2), 16-22
[26]. David, I., Fermand, E., Kuhnen, C. M., & Li, G. (2018). Expectations uncertainty and household economic behavior (No. w25336). National Bureau of Economic Research.
[27]. Delafrooz N, LailyPaim (2011) Determinants of financial wellness among Malaysia workers. African journal of Business Management 5 (24), 10092-10100
[28]. Dwyer, P. D., Gilkeson, J. H., & List, J. A. (2002). Gender differences in revealed risk taking: evidence from mutual fund investors. Economics Letters, 76(2), 151-158.
[29]. Eugenia, G.S. (2010). The relationship between personal Financial Literacy and Lending by Commercial banks in Kenya, Unpublished MBA Research Project, University of Nairobi
[30]. Felix, Ndege. (2012). The impact of financial sector deepening on economic growth in Kenya. University of Nairobi. Fisman, R., and I. Love. (2003). Trade Credit, Financial intermediary development, and industry Growth. Journal of Finance 58, no.1: 353-74.
[31]. Ferguson, R., (2002). Reflection on Financial Literacy, Remarks by Vice Chairman before the National Council on Economic Education. Washington, D.C.
[32]. Filipiak, U., & Walle, Y. M. (2015). The financial literacy gender gap: A question of nature or nurture? (No. 176). Discussion Papers.
[33]. Ford, M. R., Baptist, J. A., & Archuleta, K. L. (2011). A theoretical approach to financial therapy: The development of the Ford Financial Empowerment Model. Journal of Financial Therapy, 2(2), 1.
[34]. Fromlet, H. (2001). Behavioral finance-theory and practical application: Systematic analysis of departures from the homo oeconomicus paradigm are essential for realistic financial research and analysis. Business economics, 63-69.
[35]. Gabaix, X., & Laibson, D. (2017). Myopia and discounting (No. w23254). National bureau of economic research.
[36]. García, R., & Tessada, J. (2013). The effect of education on financial market participation: evidence from Chile. Trabajo de investigación. Pontificia Universidad Católica de Chile, EH-Clio Lab UC and Finance UC.
[37]. Garman, E. T., & Forgue, R. (2011). Personal Finance. Cengage Learning.
[38]. Garg, N. and Singh, S. (2018). Financial literacy among youth, International Journal of Social Economics, 45 (1), 173-186.
[39]. Ghauri, P. and Gronhaug, K. (2005), Research Methods in Business Studies: a Practical Guide, FT Prentice Hall, New York
[40]. Guiso, L., & Jappelli, T. (2008). Financial Literacy and Portfolio Diversification (No. 0812). Einaudi Institute for Economics and Finance (EIEF).
[41]. Häckel, B., Pfosser, S., & Tränkler, T. (2017). Explaining the energy efficiency gap-expected utility theory versus cumulative prospect theory. Energy Policy, 111, 414-426.
[42]. Hair J., A. Money., P. Samuel., & M. Page. 2007. Research Methods for Business. Wiley and Sons Ltd, USA
[43]. Hamdan, H., & Mohammed, Z. A. (2021). Determinants of Financial Literacy Among Micro Entrepreneurs in Sana’a, Yemen.
[44]. Haq, M., & Luqman, M. (2014). The contribution of international trade to economic growth through human capital accumulation: Evidence from nine Asian countries. Cogent Economics & Finance, 2(1), 947000.
[45]. Hasler, A., & Lusardi, A. (2017). The gender gap in financial literacy: A global perspective. Global Financial Literacy Excellence Center, The George Washington University School of Business.
[46]. Hatcher, L. (1994). A Step-by-step approach to using the SAS system for factor analysis and structural equation modeling. Cary, NC: SAS Institute
[47]. Henry, G. T. (2009). Practical sampling. The SAGE handbook of applied social research methods, 2, 77-105.
[48]. Hilgert, M., Hogarth, J., & Beverly, S., (2003). Household Financial Management: the connection between knowledge & behavior. Federal Reserve Bulletin (89), 309-322.
[49]. Hinga, G. K. (2014). Relationship of financial literacy on individual savings of employees of postal corporation of Kenya based in Nairobi (Doctoral dissertation, University of Nairobi).
[50]. Huang, H., Yuan, J., Lin, G., & Chi, J. (2020). Underestimation of financial literacy and financial market participation. Journal of the Asia Pacific Economy, 1-26.
[51]. Hui, T. S. W., Nguyen, C., Palameta, B., Gyarmati, D., Wagner, R. A., Rose, N., & Llp, F. (2016). The role of financial literacy in financial decisions and retirement preparedness among seniors and near-seniors. Social Research and Demonstration Corporation.
[52]. Huston, F. D. (2000). Investors” Perceptions of Earnings Quality, Auditor Independence, and the Usefulness of Audited Financial Information, Accounting Horizons, 17 (1), 16-24.
[53]. Huston, S. J. (2010). Measuring financial literacy. Journal of consumer affairs, 44(2), 296-316.
[54]. Ibrahim, M.E., and Alqaydi, F.R. (2013). Financial Literacy, personal financial attitudeand forms of personal debt among residents of the UAE. International Journal of Economics and Finance, 5 (7), 126-138
[55]. Jariwala, H. (2014). To study the level of financial literacy and its impact on investment decision-an in depth analysis of investors in Gujarat State
[56]. Joppe, M. (2000). The Research Process. Retrieved from http://www.htm.uoguelph.ca/pagefiles/MJResearch/ResearchProcess/home.html on 10th June 2020.
[57]. Jurg K. Siegenthaler, and Jeremy Ward (2000), Personal Finance and the Rush to Competence: Financial Literacy Education in the U.S
[58]. Kahneman, D., & Tversky, A. (1979). On the interpretation of intuitive probability: A reply to Jonathan Cohen.
[59]. Kailanya, M.D. (2014). The Effect of Financial Literacy on Financial Returns of Miraa Farmers in Meru County, Unpublished MSA Research Project, University of Nairobi
[60]. Kamleitner, B., & Kirchler, E. (2007). Consumer credit use: A process model and literature review. European Review of Applied Psychology, 57(4), 267-283.
[61]. Kamleitner, B., Mengay, T., & Kirchler, E. (2017). Financial decisions in the household. In Handbook of Behavioural Economics and Smart Decision-Making. Edward Elgar Publishing.
[62]. Kapor, P. (2015). Public financial management for the sustainable development. Economic and Social Development (Book of Proceedings), 5th Eastern European Economic and Social Development, 85.
[63]. Kariuki, J. K. (2012). The effect of Financial Literacy on Financial Decisions of Micro Finance Institution Clients in Embu County, Unpublished MBA Research Project, University of Nairobi)
[64]. Khalid, S. (2020). Effect of Financial Literacy on Financial Decision of the Youth at Youth Enterprise Development Fund in Mombasa County (Doctoral dissertation, University of Nairobi).
[65]. Khan, H. (2015). The impact of inflation on financial development. International Journal of Innovation and Economic Development, 1(4), 42-48.
[66]. Kim, J., Gutter, M. S., & Spangler, T. (2017). Review of family financial decision making: Suggestions for future research and implications for financial education. Journal of Financial Counseling and Planning, 28(2), 253-267
[67]. Kimani, S. (2014). The Role of Financial Literacy in Personal Financial Decisions: Case of Balozi Sacco Members (Doctoral dissertation, United States International University –Africa).
[68]. Kimiyaghalam, F., & Safari, M. (2015). Review papers on definition of financial literacy and its measurement. SEGi Review, 8, 81-94.
[69]. Klapper, L., Lusardi, A., & Van Oudheusden, P. (2015). Financial literacy around the world. World Bank. Washington DC: World Bank.
[70]. Lamidi, M. D. R. The Effect of Digital Marketing and Financial Inclusion on Business Sustainability through Marketing Performance Culinary Msme’s in Surakarta
[71]. Lekovi?, M. (2020). Cognitive biases as an integral part of behavioral finance. Economic Themes, 58(1), 75-96
[72]. Levine, R., N. Loayza, and T. Beck. (2000). Financial intermediation and growth: Casualty and causes. Journal of Monetary Economics,46 (1), 31-77
[73]. Ljubojevi?, G., & Daši?, G. (2018). Boards attributes and their implications on decision-making process. Menadžment u hotelijerstvu i turizmu, 6(1), 19-29.
[74]. Lusardi, A. Keller, P and A. Keller (2008). New Ways to Make People Save: The Dartmouth Project, TIAA-CREF Institute, June
[75]. Lusardi, A., & Tufano, P. (2015). Debt literacy, financial experiences and over indebtedness. Journal of pension Economics and Finance, 14(04), 332-368.
[76]. Locke, C. D. (1986). Best-effort decision-making for real-time scheduling. Carnegie Mellon University.
[77]. Locke, E. A., & Latham, G. P. (1990). A theory of goal setting & task performance. Prentice-Hall, Inc.
[78]. Mahdzan, N. S. & Tabiani, S., (2013). The Impact of Financial Literacy on Individual Saving: An Exploratory Study in the Malaysian Context, Transformations in Business and Economics, 12(1(28)), 2013.41-55
[79]. McKinnon, R. (1973). Money and capital in economic development. Washington, DC: Brookings Institution
[80]. Merton, R.C. and Z. Bodie. (1995). A conceptual framework for analysing the financial environment. In the global financial system: A functional perspective, Chap. 1st , ed. 3-31. Boston: Havard Business School Press.
[81]. Miller, S.M., Noulas, A.G., (1997). Portfolio mix and large-bank profitability in the USA. Applied Economics 29, 505-512.
[82]. Muchiri, M. P. (2015). The relationship between Financial Literacy and stock Market Participation by retail Investors in Kenya, Unpublished MBA Research Project, University of Nairobi.
[83]. Mugenda, O.M., & Mugenda, A., G. (2003). Research methods quantitative and qualitative approaches: Nairobi. Applied Research and Training Services Press.
[84]. Muriithi, S. S., Narayanan, B., & Arivazhagan, M. (2012). Investors Behaviour in various Investment Avenues-A Study. International Journal of Marketing and Techonology, 2(7), 164.
[85]. Musundi M (2014). The effects of Financial Literacy on Personal Investment Decisions of Real Estate Investors in Nairobi County, Unpublished MSc Research Project, University on Nairobi, Kenya.
[86]. Mutuku, S. (2015). The effect of financial literacy on personal investment decisions amongst employees of seventh day Adventist church in Kenya (Doctoral dissertation, University of Nairobi).
[87]. Nawaz, F. (2015). Microfinance, financial literacy, and household power configuration in rural Bangladesh: An empirical study on some credit borrowers. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(4), 1100-1121.
[88]. Ndebbio, J. E, (2004). Financial deepening, economic growth and development: Evidence from Sub Saharan African countries. Nairobi: African Economic Research Consortium.
[89]. Ngigi, G. (2016). NTV inks deal with banks to educate, fund businesses http:www.nation.co.ke/business/NTV-inks-deal-with banks-to-educate—fund –small businesses/996-3480026wiz/index.html
[90]. Nicholus M. Odhiambo, (2005). Financial Liberalisation and Financial Deepening: Evidence from three sub-Saharan African (SSA) countries. African review of money finance and banking, (2005), pp. 5-23
[91]. Nikoli?, J. (2018). Contemporary issues in economics, business and management: EBM 2018. November 9-10, 2018, Faculty of Economics, University of Kragujevac, Kragujevac. Ekonomski horizonti, 20(3), 269-272.
[92]. Nyamute, W., & Maina, J. M. (2011). Effect of financial literacy on personal financial management practices.
[93]. Nyaga, R. K. (2010). Earnings and Employment Sector Choice in Kenya.
[94]. Nye, P., & Hillyard, C. (2013). Personal Financial Behaviour: The influence of Quantitative Literacy and Material Values. Numeracy, 6(1), 3.
[95]. Obago, S. O. (2014). Effect of financial literacy on management of personal finances among employees of commercial Banks in Kenya (Doctoral dissertation).
[96]. Ochanda, M. M. (2014). Effects of financial deepening on growth of small and medium sized enterprises in Kenya: A case of Nairobi County. International Journal of Social Sciences and Entrepreneurship, 1(11), 191-208.
[97]. OECD (2014) Fostering Diversity for Inclusive Growth, Women, Government and Policy Making in OECD Countries.
[98]. Ohwofasa, B.O. & Aiyedogbon, J.C.U (2013). Financial Deepening and Economic Growth in Nigeria, 1986-2011: An Empirical Investigation Journal of Economics and Development Studies, 1(1) 24-42.
[99]. Olima, B. (2013), Effect of financial literacy on personal financial management on Kenya Revenue Authority employees in Nairobi (Doctoral dissertation, University of Nairobi).
[100]. Oleche, M. O & Mutiiria, M. O. M. (2015). Financial Sector and Economic Growth in Kenya: The Case of Credit Reference Bureaus (CRBs).
[101]. Omeje, J. C., Oshi, S. N., & Oshi, D. C. (2011). Does possession of assets increase women's participation in reproductive decision-making? Perceptions of nigerian women. Journal of biosocial science, 43(1), 101-111.
[102]. Otieno, S.A (2005). Financial Deepening and Profitability of Commercial Banks in Kenya: Unpublished MBA Thesis, University of Nairobi
[103]. Otoritas Jasa Keuangan (OJK). (2013), Kerangka Strategi Nasional Literasi Keuangan Indonesia. Indonesia: FSA
[104]. Priyadharshini, S. H. (2017). From financial literacy to financial well-being: A study of the level of financial literacy of women teaching faculty in educational institutions in Coimbatore region. Exclude quotes Off Exclude matches, 1.
[105]. Patrick, H. T. (1966). Financial development and economic growth in underdeveloped countries. Economic development and Cultural change, 14(2), 174-189.
[106]. Pompian MM (2008) Using behavioural investor types to build better relationships with your clients. Journal of Financial Planning, 64-76
[107]. Rahmandoust, M., Shah, I. M., Norouzi, M., Hakimpoor, H., & Khani, N. (2011). Teaching financial literacy to entrepreneurs for sustainable development. OIDA International Journal of Sustainable Development, 2(12), 61-66.
[108]. Rajesh, G. A. (2017). An examination on financial literacy among women in Palakkad district, Kerala. International Journal of Research in Economics and Social Sciences (IJRESS), 7(10).
[109]. Rashid, H. A., Rsool, N., Mubashir, M., & Arif, Z. (2021). Implications of Financial Literacy, Financial Attitude and Financial Wellbeing towards Economic Empowerment: Evidence from Pakistan. Journal of the Punjab University Historical Society, 34(01).
[110]. Remund, D. L. (2010). Financial literacy explicated: The case for a clearer definition in an increasingly complex economy. Journal of consumer affairs, 44(2), 276-295.
[111]. Ringle, C. M., Wende, S., & Becker, J. M. (2015). SmartPLS 3. SmartPLS GmbH, Boenningstedt. Journal of Service Science and Management, 10(3)
[112]. Ritter, J. R. (2003). Behavioral finance. Pacific-Basin finance journal, 11(4), 429-437
[113]. Sabana, B.M (2014). Entrepreneur financial literacy, financial access, transaction costs and performance of micro enterprises in Nairobi city county, Kenya
[114]. Schumpeter, J. (1982). The theory of economic development: An inquiry into profits, capital credit, interest, and the business cycle. Cambridge, MA: Harvard university press.
[115]. Sewell M (2010) Behavioral finance. University of Cambridge, 1-13.
[116]. Shaw, E. (1973). Financial deepening in economic development. New York: Oxford University Press.
[117]. Shiller, R. J. (2000). Measuring bubble expectations and investor confidence. The Journal of Psychology and Financial Markets, 1(1), 49-60
[118]. Shefrin, H. (2010). Behavioralizing finance. Now Publishers Inc.
[119]. Sindani, M. (2013). The impact of financial sector deepening on economic growth in Kenya. International Journal of Social Sciences in Economics and Finance, 25(2), 76-92.
[120]. Solanke, A. A., & Dandago, K. I. (2018). Accounting for gender issues: a study of variations and factors influencing women's participation in household financial decisions among major ethnic groups in Nigeria. In The 4th Annual International Academic Conference on Accounting and Finance (pp. 18-20).
[121]. Sudindra, V. R., & Naidu, J. G. (2018). Financial Behaviour and Decision-Making. International Journal of Creative Research Thoughts, 6(1), 1427-1435
[122]. Suwanaphan, S. (2013, June). ‘Personal Financial Literacy of Academic Support-Employee in Chiang Mai-University. In Proceedings from Management-Knowledge and Learning International Conference (pp. 1061-1065).
[123]. Trochim, W. (2016). Data collection methods. Colorado state University.
[124]. Tschache, C. A. (2009). Importance of financial literacy and financial literacy content in curriculum (Doctoral dissertation, Montana State University-Bozeman, College of Education, Health & Human Development).
[125]. Tufano, P. (2009). Consumer finance. Annu. Rev. Financ. Econ., 1(1), 227-247.
[126]. Van Rooij, M., Lusardi, A., & Alessie, R. (2011). Financial literacy and stock market participation. Journal of Financial economics, 101(2), 449-472.
[127]. Volpe, R., Chen, H., dan Pavlicko, J., (1996). Personal Investment Literacy Among College Students, Financial Practice and Education, 86-94.
[128]. Wachira, I. M., & Kihiu, E. N. (2012). Impact of financial literacy on access to financial services in Kenya.
[129]. Weber, E. M. (1999). Models and mosaics: Investigating cross-cultural differences in risk perception and risk preference. Psychonomic Bulletin & Review, 6(4), 611-617.
[130]. Webley, P. A. (2014). Adsorption technology for CO 2 separation and capture: a perspective. Adsorption, 20(2-3), 225-231.
[131]. Willis, L. E. (2008). Against financial-literacy education. Iowa L. Rev., 94, 197.
[132]. Xiao, J. J. (2008). Applying behavior theories to financial behavior. In Handbook of consumer finance research (pp. 69-81). Springer, New York, NY.
[133]. Yakimova, V. (2021). Financial instability as a sustained export growth limiting factor of the Russian far east regions. In E3S Web of Conferences (Vol. 291, p. 03002). EDP Sciences.
[134]. Yu, K. M., Wu, A. M., Chan, W. S., & Chou, K. L. (2015). Gender differences infinancial literacy among Hong Kong workers. Educational Gerontology, 41(4), 315-326.
[135]. Zait, A. & Bertea, P.E. (2014), Financial literacy - Conceptual definition and proposed approach for a measurement instrument. The Journal of Accounting and Management, 3, 37-42.

ABSTRACT:
The study focused on the effect of financial literacy on financial decisions among women in Mombasa County, Kenya. Financial literacy plays a vital role in sound financial decision-making and affects the individual’s financial well-being and societal economic growth and development. The financial markets are expanding every day with technology and globalization; the customer credit services have also expanded posing a challenge to individuals especially those with low financial literacy levels. The financial environment is becoming complex everyday with uncertainties rocking financial markets. Making sound financial decision is attributed to high financial literacy coupled with possession of comprehensive and reliable information. The objective of the study was to examine the effect of financial literacy on financial decisions. The study was founded on Goal Setting Theory, Prospect theory and Financial Behavior Theory. The independent variable of the study was financial literacy, control variables were growth of the financial sector, demographic factors and investment capital while financial decisions was the dependent variable. To achieve the objective of the study, descriptive research design was applied. Data was collected among 200 women across Mombasa County by use of questionnaires. The study adopted stratified random sampling. The response rate was 70.5%. Shapiro-Wilk test, Durbin-Watson test of Multi-collinearity and Heteroscedasticity were checked before carrying out regression analyses. Demographic factors had correlation coefficients of 0.334 with financial literacy, 0.094 with investment capital and 0.338 with financial sector growth. Financial literacy had correlation coefficients of 0.119 with investment capital and 0.192 with growth of financial sector. Investment capital had a correlation coefficient of 0.271 with growth of financial sector. All the p-values were less than 0.05 implying that they were significant. The study established that, financial literacy has a positive significant effect on financial decisions. Demographic factors had correlation coefficients of 0.334 with financial literacy, 0.094 with investment capital and 0.338 with financial sector growth. Financial literacy had correlation coefficients of 0.119 with investment capital and 0.192 with growth of financial sector. Investment capital had a correlation coefficient of 0.271 with growth of financial sector. Demographic factors, financial literacy, investment capital and growth of financial sector were found to have p-values of less than 0.01 implying that, they are statistically significant at 99% confidence level. R2 was 0.460 while adjusted R2was 0.176, implying financial literacy predicted a variance of 17.6% at 95% confidence level on financial decisions. The study was limited in scope with data being collected on sample size of 200 women in a population of 598046 women. To enhance the replicability of the results, a greater sample size should be considered. Other determinants of financial decisions such as psychological factors, which influence behavior and attitudes, risk tolerance and socioeconomic factors, should be considered for further study. The study recommends collaboration among government and other stakeholders to engage in financial literacy awareness among women and enact policies that favor sound financial decisions.

IJSSER is Member of