“Financial Literacy and Investment Decisions Among Young Adults”

Abstract: In today’s dynamic financial environment, young adults are increasingly exposed to complex financial decisions and investment opportunities. However, their ability to make sound financial choices largely depends on their level of financial literacy. This study investigates the relationship between financial literacy and investment decision-making among young adults, aiming to assess how financial knowledge influences their ability to plan, evaluate, and engage in various investment activities. The research adopts a quantitative approach, collecting primary data through structured questionnaires administered to a sample of young adults aged 18 to 35. The study evaluates respondents' understanding of key financial concepts such as budgeting, interest rates, inflation, risk diversification, and investment planning. It also explores behavioral factors, including risk tolerance, confidence, and the influence of technology on financial decisions. Findings indicate a strong positive correlation between financial literacy and responsible investment behavior. Participants with higher levels of financial literacy demonstrated greater confidence in managing investments, preferred diversified portfolios, and showed better understanding of long-term financial planning. Conversely, low levels of financial literacy were associated with hesitancy, impulsive decisions, or complete avoidance of investment activities. The study concludes that enhancing financial literacy through education and awareness programs can significantly improve the investment decisions of young adults, leading to better financial security and economic well-being. It recommends the integration of financial education into academic curricula and the development of accessible financial learning platforms tailored to youth.