Financial Literacy and Financial Well-Being in Rural Households in Ghana: The Role of Financial Information Consumption

Peter Kwame Kuutol (), Josue Mbonigaba and Rufaro Garidzirai
Additional contact information
Peter Kwame Kuutol: School of Accounting, Economics, and Finance, University of KwaZulu-Natal, Durban 4041, South Africa
Josue Mbonigaba: School of Accounting, Economics, and Finance, University of KwaZulu-Natal, Durban 4041, South Africa
Rufaro Garidzirai: Faculty of Economics and Financial Studies, Walter Sisulu University, Butterworth 4960, South Africa

Sustainability, 2024, vol. 16, issue 19, 1-24

Abstract: While financial literacy is crucial in improving the population’s financial well-being, its effectiveness can be enhanced by exposure to financial information. This paper investigates the nexus between financial literacy, financial information consumption, and financial well-being in rural Ghana, framed within the perspectives of prospect theory and resource dependency theory. The study employed cross-sectional data from a survey of 663 rural households using simple random and cluster sampling with reflective-reflective constructs. The data were analysed using partial least squares structural equation modelling. The findings reveal that financial literacy and financial information consumption significantly enhance financial well-being among rural households in Ghana. Financial literacy also promotes financial information consumption. Notably, financial literacy’s impact on financial well-being is stronger when mediated by the consumption of financial information. These findings underscore the importance of improving financial literacy and information access to uplift financial well-being in rural areas. Moreover, the study highlights that financial literacy education is crucial as it plays a mediating role; recipients of financial education experience a more substantial impact. Such findings emphasise the importance of acquiring financial knowledge and effectively processing financial information to achieve financial prosperity, particularly in rural areas. These findings should motivate individuals, especially those in rural areas, to process financial information successfully rather than merely acquiring financial knowledge to attain financial prosperity.

Keywords: financial literacy; financial well-being; financial information; rural settings (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/16/19/8380/pdf (application/pdf)
https://www.mdpi.com/2071-1050/16/19/8380/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:16:y:2024:i:19:p:8380-:d:1486494

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().