The Influence of Income on Financial Well-Being with Financial Literacy as a Mediating Variable: A Study of the Community in Poncokusumo Tourism Village

Ragil Fananda Sofyan and Kusuma Ratnawati
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Ragil Fananda Sofyan: Brawijaya University
Kusuma Ratnawati: Department of Management, Faculty of Economic and Business, Brawijaya University, Malang, Indonesia

International Journal of Research in Business and Social Science (2147-4478), 2025, vol. 14, issue 4, 184-190

Abstract: This study aims to examine and analyze the effect of income on financial well-being, with financial literacy serving as a mediating variable. A quantitative research approach was employed, with the object of study being the community of Poncokusumo Tourism Village. The sample size was determined using a saturated sampling technique, involving 154 respondents from the village community. Data were collected through questionnaires and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings reveal that: (i) income has a significant effect on financial well-being, (ii) financial literacy significantly influences financial well-being, (iii) income positively affects financial literacy, and (iv) financial literacy mediates the relationship between income and financial well-being. Income plays a crucial role as it significantly enhances individuals' quality of life by enabling them to meet daily needs, improve living standards, and plan for future financial security. Furthermore, stable income contributes to greater economic resilience among families and fosters community development. Respondents reported a general satisfaction with their monthly income, which in turn facilitates better financial management and supports the achievement of both short-term and long-term financial goals. This study contributes to the literature by suggesting that village government institutions, non-governmental organizations, and other stakeholders should take initiatives to provide financial literacy training. Future research is encouraged to incorporate additional variables to deepen the understanding of factors influencing financial well-being. Key Words:Financial Well-Being, Income, Financial Literacy, Tourism Village

Date: 2025
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