Effect of Financial Literacy on Personal Financial Management of Employees in Law Firms in Mombasa County in Kenya
Abstract
The study investigated the effect of financial literacy on the personal financial
management of employees working in law firms in Mombasa County, in Kenya. The
study applied descriptive research design on a target population of 66 Law firms as per
law society of Kenya directory 2017. A census of all law firms within Mombasa County
was analyzed. A self-administered questionnaire was given to the respondent’s one in
each law firm to an employee other than the proprietor or partners in case of a
partnership. The first part of the questionnaire covered the demographic variables. The
second part covered financial literacy and personal financial management questions
respectively on a 5 point Likert scale. Statistical inferences were drawn by the use of
ANOVA (Analysis of variance) and tabulations of the study variables. The study found
out that the financial literacy positively affects personal financial management among
the employees working in law firms in Mombasa County. The study a strong linear
relationship amongst the investment decisions, the budgeting decisions, the retirement
plans and the saving plans on personal financial management on the employees working
in law firms in Mombasa County. The retirement plans had the highest regression
coefficient. The coefficient of determination R square was 0. 617. The reliability
analysis was done by use of Cronbach’s coefficient alpha. The overall regression model
was significant at 95% level of significance. The study recommends that the proprietors
of law firms should come up with a financial literacy programs aimed at addressing the
financial wellbeing of their employees. The firms should introduce financial planning
programs emphasizing the importance of saving plans. The study faced numerous
limitations. Some of the respondents failed to return all the questionnaires and some
even gave incomplete questionnaires.
Publisher
University of Nairobi
Subject
Financial LiteracyRights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
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