Lao Students’ Financial Behavior and Financial Well-being : The Role of Gender, Competence, Confidence, and Trust in Bank Systems

Abstract: To increase sound financial behavior and financial well-being among people in different countries, we need policies developed from various local perspectives. We have conducted a field study in the lower-middle-income country Laos, founded on a previous study from a high-income country. We explored the association of individual differences in financial competence, financial confidence, numerical ability, and trust in bank systems on financial behaviors and financial well-being. We used a diverse sample of students (N=620) from TheNational University of Laos. We found that neither financial competence, financial confidence, nor numerical ability can predict frequent engagement in sound financial behavior and financial anxiety, when controlling self-control and sociodemographic. Trust in bank systems, on the other hand, has a significant association with sound financial behavior and financial anxiety. Regarding financial security, we found that financial competence and trust in bank systems have associations with feeling more secure about financial matters. In addition, being a woman is negatively related to feel financial security. Otherwise, both genders had similar levels of financial competence, confidence, numerical ability, behavior, and anxiety. Our findings show that many lessons can be learned when we use proven methods in new contexts. In more concrete terms does the results suggest policymakers to reinforcing the transparency and reliability of banks. This might help individuals globally to achieve better financial well-being.