Financial Capability, Financial Well-Being, and Life Satisfaction of Women in an Emerging Economy

Life satisfaction depends on several life aspects, such as relationships, achievements, health, and work satisfaction. Theorists and experts contend that domain-specific factors and behaviors predict domain-specific satisfaction. Our study examines life satisfaction from the standpoint of behavior finance indicators by incorporating financial capability factors such as financial literacy, financial management behavior, and financial self-efficacy as antecedents to financial satisfaction and financial stress. Financial satisfaction and financial stress are further assumed to predict life satisfaction. Data are collected from 308 working women using a self-administered questionnaire in three different waves in Pakistan. By examining the fitness of the measurement model, we proceeded toward path analysis of the structural equation model. All the hypothesized relationships are supported except the paths between financial literacy to financial stress and financial management behavior to financial satisfaction. The results and implications are presented based on the findings of the study.