Exploring factors affecting young adults' financial management behavior: A hybrid PLS-SEM and fsQCA approach

Abstract

This study investigates the factors influencing financial management behaviors (FMB) among young adults in Poland, drawing on the Theory of Planned Behavior (TPB). Specifically, it examines the roles of financial attitude, family financial socialization, peer influence, financial self-efficacy, and subjective financial knowledge. Data were collected from 340 university students using convenience sampling. A hybrid analytical approach combining partial least squares structural equation modeling (PLS-SEM) and fuzzy-set qualitative comparative analysis (fsQCA) was employed. PLS-SEM results indicate that financial attitude, subjective financial knowledge, and financial self-efficacy are significantly associated with FMB. Contrary to expectations, family financial socialization had no significant effect, while peer influence was significant but negative effect. FsQCA revealed two distinct pathways leading to positive FMB, highlighting the importance of financial attitude and knowledge, even in the absence of strong peer or family support. The findings underscore the complexity of financial behavior and suggest that educational interventions should focus on improving financial attitudes and self-efficacy, while also acknowledging the important roles of family and peer influences. This study contributes novel insights into financial behavior research in Eastern Europe and demonstrates the value of combining SEM and fsQCA in behavioral finance studies.