THE INFLUENCE OF FINANCIAL LITERACY, FINANCIAL ATTITUDE, ILLUSION OF CONTROL, FINANCIAL EXPERIENCE, AND PARENTAL SOCIALIZATION ON INVESTMENT DECISIONS OF STUDENTS IN MALANG
Abstract
This research is motivated by the importance of investment, financial Literacy and other factors that affect students' investment decisions. This study aims to identify the influence of financial Literacy, financial attitudes, Illusion of control, financial Experience, and parental socialization on students' investment decisions in Malang. A deep understanding of these factors is expected to provide insights into developing more effective financial education policies. This study uses a quantitative method with the Structural Equation Modeling-Partial Least Squares (SEM-PLS) approach. The research sample consisted of 210 respondents. The sampling technique uses non-probability sampling with the purposive sampling method. The validity of the questionnaire was tested using convergent validity and discriminant validity, while the reliability was tested from the composite reliability and Cronbach's alpha values. Data analysis was done using path coefficient through bootstrapping with the SmartPLS version 3 application.The results of the study show that Financial Literacy and financial attitudes have a very significant influence on students' investment decisions. Other factors, such as the Illusion of control and parental socialization, were also significant, while financial Experience did not significantly influence. These findings emphasize the importance of financial education and parental support in shaping wise investment behaviour among college students. In addition, a particular trend can be seen in the increase in the number of investors from students since the COVID-19 pandemic. This research is expected to provide additional knowledge for readers about the factors that affect students' investment decisions.
References
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Bangun, V. L. (2020). The Effect of Financial Literacy, Risk Perception and Overconfidence on Investment Decisions (Case Study on the Millennial Generation in Yogyakarta). Endocrine, 9(May), 6.
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Humaira, I., & Sagoro, E. M. (2018a). The Influence of Financial Knowledge, Attitudes, and Personality on Financial Management Behavior in MSME Actors of the Bantul Regency Batik Handicraft Center. Nominal, Barometer of Accounting and Management Research, 7(1). https://doi.org/10.21831/nominal.v7i1.19363
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Kartini, K., & Nugraha, N. F. (2015). The influence of illusions of control, overconfidence, and emotion on investment decision-making among investors in Yogyakarta. AJIE, 4(2), 114–122. https://doi.org/10.20885/ajie.vol4.iss2.art6
Lusardi, A., & Mitchelli, O. S. (2007). Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education. Business Economics, 42(1), 35–44. https://doi.org/10.2145/20070104
Mahafani, D. F., Puspa, D. M., Khasanah, N., Wulandari, S., & Andriani, V. (2021). Analysis of Millennial Generation Behavior in Stock Investment Decision Making during the Covid-19 Pandemic. Academica: Journal of Multidisciplinary Studies, 5(1), 121–140. http://ejournal.iainsurakarta.ac.id/index.php/academica/article/view/4118
Mandell, L. (2008). Financial Literacy of Young American Adults: Results of the 2008 National Jump$tart Coalition Survey of High School Seniors and College Students. Jump$tart Coalition® for Personal Financial Literacy, pp. 163–183.
Nofsinger, J. R. (2005). Social Mood and Financial Economics. Journal of Behavioral Finance, 6(3), 144–160. https://doi.org/10.1207/s15427579jpfm0603_4
Pradhana, R. W. (2018). The Influence of Financial Literacy, Cognitive Bias, and Emotional Bias on Investment Decisions (Study on Investors of the Investment Gallery of the State University of Surabaya). Journal of Management Sciences (JIM), 6(3), 108–117.
Pradikari, E., & Isbanah, Y. (2018). The Influence of Financial Literacy, Illusion of Control, Overconfidence, Risk Tolerance, and Risk Perception on Investment Decisions in Students in the City of Surabaya. Journal of Management Sciences (JIM), 6(4), 424–434.
Pratama, A. (2021). Proliferating, the Number of Stock Investors on the IDX Increased by One Million in 2021. INews. https://www.idxchannel.com/market-news/tumbuh-pesat-jumlah-investor-saham-di-bei-bertambah-satu-juta-di-2021
Rosita, M. L. dwi, & Miranti, T. (2023). PROCEEDING ICONIES FACULTY OF ECONOMICS, HOW THE SOCIAL ENVIRONMENT MEDIATES FACTORS AFFECTING THE STUDENT'S INTENTION TO SAVE IN SHARIA BANK? International Conference of Islamic Economics and Business 9th 2023 International Conference of Islamic Econom. International Conference of Islamic Economics and Business 9th, 187–198.
Sarwono, J., & Narimawati, U. (2015). I am creating theses, theses, and dissertations with partial least square SEM (PLS-SEM) (A. Prabawati (ed.)). Andi.
Sauddin, A., & Ramadhani, N. S. (2018). Analysis of the influence of teaching skills, student emotions, academic pressure and perceived academic control on student academic achievement using the SEM-PLS approach. MSA Journal (Mathematics and Statistics and Its Applications), 6(1), 6. https://doi.org/10.24252/msa.v6i1.5063
Sina, P. G. (2014). The Role of Parents in Educating Children in Finance (Literature Review). Journal of Humanities Development, 14(1), 74–86.
Suprasta, N., & MN, N. (2020). Factors that affect the investment decision-making of individual investors in Mataram City. Jmm Unram - Master of Management Journal, 9(4), 341. https://doi.org/10.29303/jmm.v9i4.584
Tanusdjaja, H. (2018). Individual investors' investment decisions are based on competence, overconfidence, and education. Journal of Muara Economics and Business, 2(1), 234. https://doi.org/10.24912/jmieb.v2i1.998
Ulum, I. F., & Solekah, N. A. (2024). The Impact of Lifestyle, Financial Literacy, and Ease of Use of E-Payment on E-Wallet Users' Consumptive Behavior in the Millennial Generation. MEC-J (Management and Economics Journal), 8(1), 67–82. https://doi.org/10.18860/mec-j.v8i1.26265
Umaya, F. (2014). Emotions of Regret and Decision-Making in the Economic Field. Psychology Bulletin, 22(2), 117. https://doi.org/10.22146/bpsi.11461
Violeta, J., & Linawati, N. (2019). The influence of anger traits, anxiety traits, and demographic factors on investment decisions. Journal of Marketing Management, 13(2), 89–96. https://doi.org/10.9744/pemasaran.13.2.89-96
Amilia, S., Bulan, T. P. L., & Rizal, M. (2018). The influence of financial Literacy, socialization of parents, and peers on the saving behaviour of students aiming for the mission of the Faculty of Economics, University of Samudra. Journal of Economic Oceans, 2(2), 97–107.
Aminatuzzahra'. (2014). Perception of the Influence of Financial Knowledge, Financial Attitudes, and Socio-Demographics on Financial Behavior in Individual Investment Decision Making (Case Study on Master of Management Students at Diponegoro University). Journal of Strategic Business, 23(2), 70–96. https://doi.org/https://doi.org/10.14710/jbs.23.2.70-96
Anuraga, G., Sulistiyawan, E., & Munadhiroh, S. (2017). Structural Equation Modeling – Partial Least Square for Modeling the Public Health Development Index (IPKM) in East Java. National Seminar on Mathematics and Its Applications, 257.
Aren, S., & Zengin, A. N. (2016). Influence of Financial Literacy and Risk Perception on Choice of Investment. Procedia - Social and Behavioral Sciences, 235, 656–663. https://doi.org/10.1016/j.sbspro.2016.11.047
Awais, M., Fahad Laber, M., Rasheed, N., & Khursheed, A. (2016). Impact of Financial Literacy and investment experience on risk tolerance and investment decisions: Empirical evidence from Pakistan. International Journal of Economics and Financial Issues, 6(1), 73–79.
Bangun, V. L. (2020). The Effect of Financial Literacy, Risk Perception and Overconfidence on Investment Decisions (Case Study on the Millennial Generation in Yogyakarta). Endocrine, 9(May), 6.
Cheppy, A. M. (2021). The number of capital market investors increased rapidly during the January-August 2021 period. Pasar modal.Ojk.Go.Id. https://pasarmodal.ojk.go.id/News/Detail/20485
Clark, A. E., & Oswald, A. J. (1996). Satisfaction and comparison income. Journal of Public Economics, 61(3), 359–381. https://doi.org/10.1016/0047-2727(95)01564-7
Coşkun, A., Şahin, M. A., & Ateş, S. (2016). Impact of Financial Literacy on the Behavioral Biases of Individual Stock Investors: Evidence from Borsa Istanbul. Business and Economics Research Journal, 7(3), 1–1. https://doi.org/10.20409/berj.2016321805
Diener, E., & Seligman, M. E. P. (2004). Beyond Money. Psychological Science in the Public Interest, 5(1), 1–31. https://doi.org/10.1111/j.0963-7214.2004.00501001.x
F. Hair Jr., J., Sarstedt, M., Hopkins, L., & G. Kuppelwieser, V. (2014). Partial least squares structural equation modelling (PLS-SEM). European Business Review, 26(2), 106–121. https://doi.org/10.1108/EBR-10-2013-0128
Fahmi, Z. (2021). The Influence of Overconfidence, Experience and Risk Perception on Individual Investment Decision Making in Makassar City. 6.
Falaqi, Y., & Wardana, Guntur Kusuma. (2024). The Moderating Effect of Financial Literacy on the Determining Influence of Firm Value Factors. A Research Journal on Islamic Finance, 10(01), 16–35.
Gulo, M. (2017). The Influence of Parents' Economic Background and Student Learning Motivation on the Achievement of History Learning Students History Education at Sanata Dharma University Yogyakarta. Thesis.
Hair, J. F., Risher, J. J., Sarstedt, M., & Ringle, C. M. (2019). When to use and how to report the results of PLS-SEM. European Business Review, 31(1), 2–24. https://doi.org/10.1108/EBR-11-2018-0203
Haryati, M. (2016). Investment According to the Perspective of Islamic Economics. Journal of Islamic Economics and Business), 1(1), 66–78. http://ejournal.radenintan.ac.id/index.php/ikonomika
Hidayat, R. (2003). Pseudo-rationality and anomalies in 1 economic behaviour. Psychology Bulletin, 11(1), 30–46. https://doi.org/10.22146/bpsi.7459
Humaira, I., & Sagoro, E. M. (2018a). The Influence of Financial Knowledge, Attitudes, and Personality on Financial Management Behavior in MSME Actors of the Bantul Regency Batik Handicraft Center. Nominal, Barometer of Accounting and Management Research, 7(1). https://doi.org/10.21831/nominal.v7i1.19363
Humaira, I., & Sagoro, E. M. (2018b). The Influence of Financial Knowledge, Attitudes, and Personality on Financial Management Behavior in MSME Actors of the Bantul Regency Batik Handicraft Center. Nominal, Barometer of Accounting and Management Research, 7(1). https://doi.org/10.21831/nominal.v7i1.19363
Kahneman, D., & Tversky, A. (2013). Prospect Theory: An Analysis of Decision Under Risk (pp. 99–127). https://doi.org/10.1142/9789814417358_0006
Kamarck, T. W., Schwartz, J. E., Shiffman, S., Muldoon, M. F., Sutton-Tyrrell, K., & Janicki, D. L. (2005). Psychosocial Stress and Cardiovascular Risk: What is the Role of Daily Experience? Journal of Personality, 73(6), 1749–1774. https://doi.org/10.1111/j.0022-3506.2005.00365.x
Kartini, K., & Nugraha, N. F. (2015). The influence of illusions of control, overconfidence, and emotion on investment decision-making among investors in Yogyakarta. AJIE, 4(2), 114–122. https://doi.org/10.20885/ajie.vol4.iss2.art6
Lusardi, A., & Mitchelli, O. S. (2007). Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education. Business Economics, 42(1), 35–44. https://doi.org/10.2145/20070104
Mahafani, D. F., Puspa, D. M., Khasanah, N., Wulandari, S., & Andriani, V. (2021). Analysis of Millennial Generation Behavior in Stock Investment Decision Making during the Covid-19 Pandemic. Academica: Journal of Multidisciplinary Studies, 5(1), 121–140. http://ejournal.iainsurakarta.ac.id/index.php/academica/article/view/4118
Mandell, L. (2008). Financial Literacy of Young American Adults: Results of the 2008 National Jump$tart Coalition Survey of High School Seniors and College Students. Jump$tart Coalition® for Personal Financial Literacy, pp. 163–183.
Nofsinger, J. R. (2005). Social Mood and Financial Economics. Journal of Behavioral Finance, 6(3), 144–160. https://doi.org/10.1207/s15427579jpfm0603_4
Pradhana, R. W. (2018). The Influence of Financial Literacy, Cognitive Bias, and Emotional Bias on Investment Decisions (Study on Investors of the Investment Gallery of the State University of Surabaya). Journal of Management Sciences (JIM), 6(3), 108–117.
Pradikari, E., & Isbanah, Y. (2018). The Influence of Financial Literacy, Illusion of Control, Overconfidence, Risk Tolerance, and Risk Perception on Investment Decisions in Students in the City of Surabaya. Journal of Management Sciences (JIM), 6(4), 424–434.
Pratama, A. (2021). Proliferating, the Number of Stock Investors on the IDX Increased by One Million in 2021. INews. https://www.idxchannel.com/market-news/tumbuh-pesat-jumlah-investor-saham-di-bei-bertambah-satu-juta-di-2021
Rosita, M. L. dwi, & Miranti, T. (2023). PROCEEDING ICONIES FACULTY OF ECONOMICS, HOW THE SOCIAL ENVIRONMENT MEDIATES FACTORS AFFECTING THE STUDENT'S INTENTION TO SAVE IN SHARIA BANK? International Conference of Islamic Economics and Business 9th 2023 International Conference of Islamic Econom. International Conference of Islamic Economics and Business 9th, 187–198.
Sarwono, J., & Narimawati, U. (2015). I am creating theses, theses, and dissertations with partial least square SEM (PLS-SEM) (A. Prabawati (ed.)). Andi.
Sauddin, A., & Ramadhani, N. S. (2018). Analysis of the influence of teaching skills, student emotions, academic pressure and perceived academic control on student academic achievement using the SEM-PLS approach. MSA Journal (Mathematics and Statistics and Its Applications), 6(1), 6. https://doi.org/10.24252/msa.v6i1.5063
Sina, P. G. (2014). The Role of Parents in Educating Children in Finance (Literature Review). Journal of Humanities Development, 14(1), 74–86.
Suprasta, N., & MN, N. (2020). Factors that affect the investment decision-making of individual investors in Mataram City. Jmm Unram - Master of Management Journal, 9(4), 341. https://doi.org/10.29303/jmm.v9i4.584
Tanusdjaja, H. (2018). Individual investors' investment decisions are based on competence, overconfidence, and education. Journal of Muara Economics and Business, 2(1), 234. https://doi.org/10.24912/jmieb.v2i1.998
Ulum, I. F., & Solekah, N. A. (2024). The Impact of Lifestyle, Financial Literacy, and Ease of Use of E-Payment on E-Wallet Users' Consumptive Behavior in the Millennial Generation. MEC-J (Management and Economics Journal), 8(1), 67–82. https://doi.org/10.18860/mec-j.v8i1.26265
Umaya, F. (2014). Emotions of Regret and Decision-Making in the Economic Field. Psychology Bulletin, 22(2), 117. https://doi.org/10.22146/bpsi.11461
Violeta, J., & Linawati, N. (2019). The influence of anger traits, anxiety traits, and demographic factors on investment decisions. Journal of Marketing Management, 13(2), 89–96. https://doi.org/10.9744/pemasaran.13.2.89-96
Published
2024-09-27
How to Cite
SHIDQIY, Moh. Ilman Rofi'ush; MIRANTI, Titis.
THE INFLUENCE OF FINANCIAL LITERACY, FINANCIAL ATTITUDE, ILLUSION OF CONTROL, FINANCIAL EXPERIENCE, AND PARENTAL SOCIALIZATION ON INVESTMENT DECISIONS OF STUDENTS IN MALANG.
Proceedings of the International Conference of Islamic Economics and Business (ICONIES), [S.l.], v. 10, n. 1, p. 1273-1284, sep. 2024.
ISSN 2541-3333.
Available at: <https://conferences.uin-malang.ac.id/index.php/iconies/article/view/3065>. Date accessed: 03 feb. 2026.
Section
Articles
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