The influence of innovation on personal financial management and financial literacy

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Abstract

Financial planning evaluates a person’s financial goals by identifying the necessary steps to achieve them according to their financial resources. With the increased influence of technology on day-to-day life and the countless innovations, incorporating new opportunities into the financial planning process increases the possibilities of achieving settled purposes. Using smartphone applications to manage personal finances improves economic behaviour, knowledge, attitudes, and motivation. In this study, we will analyse the changes brought about by using cash management applications among young people and through the delivery of a survey, we could gather their feedback. The answers are then analysed through SPSS Statistics, using Pearson correlation analysis. We measure the strength and direction of the relationship between variables related to what leads to using or not using cash management applications. At the end of the analyses, we conclude a weak positive relationship between using cash management applications and improving personal finances, according to Good Things Foundation (n.d.). From analysing the ties between smartphone usage and cash management apps, resulting in a fragile negative relationship, we conclude that the weak relationship between cash management apps and improved personal finances results from a low recognition in this typology of applications.

Keywords: Household Saving, Borrowing, Debt and Wealth, Financial Literacy, Public Economics, Financial Sector, Innovation

Authors’ individual contribution: Conceptualization — M.Z.; Methodology — R.V.; Formal Analysis — R.V.; Data Collection — M.Z.; Writing — Original Draft — M.Z.; Writing — Review & Editing — R.V.; Supervision — J.M.; Project Administration — J.M.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: G51, G53, G59

Received: 05.06.2023
Accepted: 17.05.2024
Published online: 21.05.2024

How to cite this paper: Mamo, J., Vangjel, R., & Zyko, M. (2024). The influence of innovation on personal financial management and financial literacy. Risk Governance and Control: Financial Markets & Institutions, 14(2), 54–64. https://doi.org/10.22495/rgcv14i2p6