Influence of Self Control on Financial Behaviour and Financial Well-Being Mediated by Optimism

Abstract

Manuscript type: Research paper
Research aims: This study aims to explore the influence of self-control on
financial behaviour and financial well-being. Additionally, it examines the
mediating role of optimism in these relationships.
Design/Methodology/Approach: The research adopts a quantitative,
cross-sectional design. The target population comprises the general public
residing in Balochistan. Convenience sampling was employed due to
the absence of a sampling frame. The structured questionnaire using a
variance-based structural equation modeling (SEM) through the Smart
PLS software.
Research findings: The results indicate a positive relationship between
self-control and financial behaviour and financial security, while selfcontrol
negatively correlates with financial anxiety. Furthermore,
optimism is an effective mediator between self-control and financial
behaviour as well as between self-control and financial anxiety. However,
optimism does not significantly impact financial security.
Theoretical contribution/Originality: This study contributes to
behavioural finance literature by providing a nuanced understanding of
how self-control and optimism interact to influence financial behaviour
and financial well-being. It adds to the theoretical framework by
highlighting the mediating role of optimism in these relationships.
Practitioner/Policy implications: The financial educators, policymakers,
and practitioners may leverage the understanding of self-control and
optimism to design educational programmes and interventions that
enhance individuals’ financial behaviours and mitigate financial anxiety.
Research limitation: The cross-sectional design limits the ability to
assess causality and long-term effects. Future research should consider
longitudinal studies to better understand the enduring impacts of selfcontrol
and optimism on financial behaviour and well-being.