Does financial literacy influence financial planning? A study among working women in India

Purpose Financial planning is increasingly becoming a priority for women due to their financial vulnerability. Lower financial knowledge among women often results in reduced engagement in financial planning, influenced by various demographic, social and psychological factors. Given that financial literacy is recognized as crucial for effective financial planning, this study examines the impact of financial literacy on financial planning among women in India. Design/methodology/approach A structured questionnaire was administered online to 606 women across five major cities in the National Capital Region (NCR). Data were analyzed using partial least Squares structural equation modeling (PLS-SEM), which enabled validation of the measurement model and examination of the hypothesized structural relationships. Findings Confirmatory factor analysis validated the hypothesized model, and empirical analysis revealed a significantly positive relationship between financial literacy and financial planning. The results confirm that higher literacy levels contribute to improved financial decision-making and preparedness among women. Research limitations The study is limited by its cross-sectional design and regional sample, restricting causal inference and generalizability. Research implications The findings highlight the need for targeted, gender-sensitive financial literacy programs that can enlighten inclusive financial education and policy initiatives. Practical implications This study underscores the crucial role of financial literacy in enhancing financial planning among working women, with significant societal, economic and educational implications. It fosters women’s confidence, independence and better resource management, reducing financial stress and promoting stability. Economically, it drives savings, smarter investments, and participation in formal financial systems, encouraging growth and innovation. Educationally, integrating financial literacy programs into schools and workplaces and promoting gender-specific initiatives through policies can further enhance financial planning. Academically, this research deepens understanding of financial literacy’s impact, providing a foundation for future studies and actionable insights for societal and economic progress. Originality/value This study offers a novel contribution by focusing exclusively on women – an often-overlooked group in financial behavior research – and by assessing all three OECD-defined dimensions of financial literacy: knowledge, behavior and attitude. It also uniquely integrates underexplored financial planning areas such as tax and insurance planning. By applying PLS-SEM, the study delivers validated insights that can inform more inclusive, gender-responsive financial policies and interventions.