Understanding Investment Readiness Among Generation Z: A Multidimensional Analysis Of Digital Natives' Financial Decision-Making
Year: 2025
Type: article
Study design: Observational Study
Abstract: Purpose & Scope: Using a multifaceted framework, this study aims to bridge the crucial gap between the financial readiness of Generation Z and their technological proficiency by analyzing their investment readiness. The study examines whether the six components of investment readiness—financial literacy, motivation, risk awareness, behavioural control, planning and goal-setting, and digital literacy—are all present. Method: 188 members of Generation Z (mean age = 15.26 years, 63.3% female) were given a thorough survey. Multiple linear regression modelling, variance inflation factor analysis, Cronbach's alpha reliability assessment, and exploratory factor analysis (EFA) were all used in the methodology. Mann-Whitney U tests and independent samples t-tests were used to compare genders. Results: A six-factor structure with excellent internal consistency (Cronbach's α = 0.91) was confirmed by the analysis. Eigenvalues for the retained factors ranged from 9.01 to 1.13, according to EFA. Only Factor 2 (motivation) showed significant gender differences, with men scoring higher than women (3.39 vs. 3.02, p < 0.001). All predictors' variance inflation factors remained below 5, indicating that multicollinearity is not a concern. Implications: One of the theoretical contributions is the validation of a multifaceted framework for assessing the investment readiness of digital natives. The results indicate that financial education programs should target multiple competency domains simultaneously, employing gender-sensitive strategies to enhance female motivation. The study promotes tailored strategies based on unique psychological profiles, challenging conventional demographic-based interventions. Conclusion: Investment readiness among Generation Z requires comprehensive, technology-integrated educational interventions that recognize their unique characteristics as digital natives. JEL Groups: G11, D14, and J13
Authors: Universitas Pancasila, Jakarta Selatan, Indonesia, Eka Sudarmaji, Tyahya Whisnu Hendratni, Universitas Pancasila, Jakarta Selatan, Indonesia, Murti Widyaningsih, Universitas Pancasila, Jakarta Selatan, Indonesia, Widyaningsih Azizah, Universitas Pancasila, Jakarta Selatan, Indonesia, Adi Nugroho, Universitas Pancasila, Jakarta Selatan, Indonesia, Fatimah Azzahra, Universitas Pancasila, Jakarta Selatan, Indonesia, Syarla Martiza Arian Putri, Universitas Pancasila, Jakarta Selatan, Indonesia
Institution: Pancasila University
Language: English
Subfield: Accounting
Domain: Social Sciences
SDG: Gender equality
Open Access status: hybrid
OpenAlex ID: W4414545413