The role of financial literacy in optimizing family financial planning

Abstract

This study aims to analyze the role of financial literacy in optimizing family financial planning. Financial literacy is considered an important factor that influences economic decision-making in households, including income management, expenditure, savings, investment, and risk protection. This study uses a quantitative approach with a survey method. Data were collected through questionnaires distributed to 150 household respondents in urban and semi-urban areas who were married and had a fixed income. The data analysis technique used was multiple linear regression to test the effect of financial literacy on family financial planning. The results showed that the level of financial literacy had a positive and significant effect on the effectiveness of family financial planning. Respondents with a high level of financial literacy tended to have the habit of managing finances in a structured manner, setting short-term and long-term financial goals, and being more disciplined in saving and avoiding consumer debt. These findings reinforce the importance of financial education for the community, especially in the context of families, to create household economic stability and improve long-term welfare. This study suggests that the government and financial institutions be more active in organizing financial literacy programs that are practical and easily accessible to various groups.