HOW FRAMING AFFECT AN INDIVIDUAL FINANCIAL DECISION- MAKING

This study investigates the impact of framing, specifically gain versus loss and emotional framing, on individuals’ financial risk perception and decision-making. Drawing on Prospect Theory and principles of behavioral economics, the research examines how the presentation of financial choices influences individuals’ tendencies to adopt risk-averse or risk-seeking behaviors. A structured survey was conducted with 80 participants, and the data were analyzed using descriptive statistics, chi-square tests, t-tests, ANOVA, and regression. The results show that participants are significantly more risk-seeking when financial decisions are framed as losses or when the emotional tone is negative. In contrast, demographic variables such as age, gender, and education level had minimal influence. These findings highlight the psychological effects of framing and underscore the need for ethical financial communication and improved decision-making literacy.