Research On The Impact Of Financial Literacy On Household Financial Assets Allocation

In recent years,with the continuous improvement of China's financial market,the growing wealth of residents' financial knowledge and the rapid accumulation of household financial assets,more and more families have begun to care about how to make their own development in increasingly complex financial activities select.The family is the most basic unit of society.The financial assets it owns can reflect the economic situation of a family.Active participation of residents in investment activities in the financial market will effectively promote the development of the financial industry.If a family does not understand basic financial knowledge,it often pays a high price for the consequences of its short-term or long-term financial decisions.Therefore,it is very important to study how to effectively allocate household financial assets.This article uses financial literacy as an entry point to explore the allocation of household financial assets,analyzes the relevant factors that affect the allocation of household financial assets,and tries to help residents to improve household financial decisions effect.Based on the microdata of the 2015 China Household Finance Survey(CHFS),this article divides household financial assets into risk-free,low-risk and high-risk financial assets according to the degree of risk.The dummy variable of financial literacy is constructed by factor analysis,and a descriptive statistical analysis of core variables and control variables is performed.Probit model and Tobit model were used to analyze the influencing factors of household financial market participation and the proportion of financial assets of different risk types,and multiple linear regression models were used to analyze the influencing factors of household financial asset holdings.Other control variables selected in this paper mainly include individual characteristics,family economic factors,and social environmental factors.The main contents of the research are as follows: The first part mainly expounds the background and significance of the research.With the increase of residents' disposable income,more and more studies have begun to focus on the topic of household asset allocation.The second part is related research at home and abroad.This part is the basis of the research in this article.By combing the relevant literature on financial literacy and household financial assets,I realize that there is an inseparable relationship between the two.The third part is the theoretical analysis of financial literacy and household financial assets.This part mainly sorts and classifies the main factors that affect the allocation of household financial assets,and draws the theoretical framework of the thesis research,which provides a theoretical reference for the subsequent empirical analysis.The fourth part is data description and statistical analysis.This part mainly introduces the selection methods and descriptive statistical analysis of core explanatory variables,explained variables and other control variables.The sample data briefly explains the current situation of household financial asset allocation in China,and mainly compares the financial asset selection of different age groups and urban and rural residents.The fifth part is the empirical analysis of household financial assets allocation.This part is the core content of this study.The regression model is used to empirically analyze the influencing factors of household financial asset allocation,and the regression results are analyzed in depth.The sixth part is conclusions and countermeasures.Through the study of this paper,the following conclusions are drawn:(1)Financial literacy,as a core factor affecting the allocation of household financial assets,can help residents improve the overall situation of household financial asset allocation.The higher the level of household financial literacy,the higher the degree of participation of residents in the financial market,the higher the degree of decentralization of financial assets,and the higher the amount of household financialassets held,the more opportunities they will have in financial investment activities;(2)Improving the financial literacy of residents can help improve the proportion of risk assets in household financial asset allocation and increase the degree of decentralization of household financial asset allocation,thereby reducing the non-systematic risk of households participating in financial investment;(3)It is found that residents with higher financial literacy will invest more funds in risky financial assets,especially low-risk financial assets such as funds and financial wealth management products.Compared with non-risk and high-risk financial assets,low-risk financial assets can better meet the residents' needs for the safety and profitability of financial assets;(4)In China,men show more risk aversion than women.Highly educated families are better at using financial instruments to allocate family financial assets.Owned housing and rural hukou will crowd out risky assets held by households.