Investigating the effect of digital financial literacy level on investment preferences

Finance has maintained its importance throughout history, from the barter system, the oldest economic system known to humanity, to the invention of money and today's financial technologies. It has been one of the most significant factors affecting societies' lives. Financial literacy refers to the knowledge and skills needed to manage financial resources effectively in order to achieve and sustain financial well-being. The application of modern technologies in the financial sector has introduced the concept of digital financial literacy. This study aims to investigate the impact of individuals' digital financial literacy levels on their financial investment preferences. To achieve this, a survey form was used to measure the digital financial literacy levels and investment preferences of high school students aged 15-18. The study's uniqueness is demonstrated by filling a gap in the literature, as there are no existing studies on this age group. A dataset consisting of 621 samples was obtained through face-to-face surveys conducted in 8 different high schools within the province of Trabzon. Statistical analyses and modeling were performed on this dataset to reveal the relationships between individuals' demographic characteristics, digital financial literacy levels, and investment preferences. A model showing the relationships between these factors was obtained using structural equation modeling, and the research hypotheses were tested. The findings indicated that male students had higher digital financial literacy levels compared to female students. Additionally, male students were found to be more willing to invest financially than female students. The structural model presented showed that financial knowledge is at the center of the model and positively affects all factors in the model either directly or indirectly. It was observed that as digital financial literacy levels increase, individuals' willingness to invest also increases. Moreover, it was shown that as financial knowledge and the use of financial digital technologies increase, so does the willingness to invest.