Exploring financial resilience and well-being in college students: a mixed-method analysis using orthogonal and oblique rotation techniques

Purpose This study aimed to identify the key factors constituting financial resilience (FR) and financial well-being (FWB), to explore their interrelationships, to examine demographic differences in perceptions, and to evaluate which rotation method best explains the variance in the confirmatory model of these constructs. Design/methodology/approach A non-experimental, cross-sectional design was employed, utilizing both exploratory factor analysis (EFA) and confirmatory factor analysis (CFA). EFA was conducted with both orthogonal (Varimax and Quartimax) and oblique (Oblimin and Promax) rotation methods to uncover the underlying dimensions of FR and FWB, followed by CFA using Structural Equation Modeling (SEM) to validate the models. The study targeted undergraduate students in Veracruz, Mexico, with a non-probability, self-selection sampling approach. Findings The results revealed that FR and FWB are multidimensional and interconnected constructs, with key factors such as savings, financial planning, debt management and financial knowledge being crucial. The oblique rotation models (Oblimin and Promax) provided a better fit for explaining the interdependence between these factors compared with orthogonal models. Financial resilience factors like savings and debt control influenced financial well-being, aligning with existing literature, while highlighting the need for integrated financial education. Research limitations/implications The study's sample was restricted to undergraduate students in Veracruz, limiting the generalizability of the findings. The reliance on self-selection sampling may introduce bias, and the cross-sectional design restricts causal inferences. Practical implications The study challenges traditional views by highlighting the interconnectedness of financial resilience factors. It calls for a multidimensional approach to financial resilience that includes not only the ability to withstand financial shocks but also factors like financial education, digital literacy, and access to financial products. Social implications The findings suggest that policies should promote holistic financial education and create financial products that support resilience, particularly for vulnerable populations. Additionally, integrating technology into financial services is crucial for enhancing financial inclusion and resilience. Originality/value This research contributes to understanding financial resilience and well-being by employing exploratory and confirmatory analysis methods to assess their interdependence. The study is among the few to apply orthogonal and oblique rotation methods to explain the variance in these constructs, offering a novel perspective on the interaction between financial resilience and well-being.