Awareness Study of Personal Financial Planning among the Households in Sattur Town, Virudhunagar District, Tamil Nadu

Abstract

“How is that people are motivated to go to a doctor but not motivated to go to a financial counselor, if individuals are ultimately responsible for their own financial health” (Bowditch, 2005). The above quote touches an important aspect of individual financial planning behavior i.e., the lack of motivation to engage in personal financial planning. This observation prompted the researcher’s interest in studying the individual financial behavior as personal financial planning is becoming increasingly important in academic world as well as in practical life. Financial awareness prepares an individual with the ability to understand, monitor, and use the financial resources effectively to enhance the well-being of one’s own self and also the economic security of the family. The understanding of financial needs allows one to know the financial structure and the related financial literacy level. The main objective of the study is to assess the awareness of personal financial planning among households in Sattur town. The questionnaire administered in this study measures the level of awareness about preparing financial planning and knowing the economic and social benefits of the same. The survey examines the respondents’ awareness about personal financial planning. The researcher prepares three questions to measure the level of awareness on respondents’ knowledge, skills and their views on socio economic benefits. To examine the range of awareness among households of Sattur town, three items are chosen viz, awareness on personal financial planning, perception levels, economic and social needs and their response was tabulated. The research concluded that though the study in the area of personal financial planning has recognized that general education significantly increases the investment, income and retirement savings, it may not prepare one with sufficient skill and knowledge for taking investment decisions. Only financial education at early stages of life i.e., at the school or college level, helps in promoting personal financial planning of households.