The Relationship Between Financial Efficacy, Satisfaction With Remuneration And Personal Financial Well-Being

Main Article Content

Wilmie Vosloo
Jaco Fouche
Jaco Barnard


Financial Well-Being, Financial Efficacy, Personal Finance, Remuneration Satisfaction


Financial stress is a condition that is becoming more prevalent in todays society due to factors such as high debt levels, low savings and economic recessions. Research has found that financial stress negatively influences employees performance at work. With these increasing pressures on personal finances and its interference on work, this study considers whether management should attempt to improve employees financial well-being. Management needs to be convinced that their actions can improve their employees financial well-being. This study established and measured the relationship that the subjective measures financial efficacy and satisfaction with remuneration have on financial well-being. A sample size of 9 057 employees from different sectors in South Africa was used. Confirmatory factor analyses were used, as the survey was based on a previously developed survey and it was already known which items load onto which factors. Data was analysed using Pearson correlation coefficients and multiple regression analysis. Three hypotheses were tested. Hypothesis 1: There is a relationship between satisfaction with remuneration and financial well-being. Hypothesis 2: There is a relationship between financial well-being and financial efficacy. Hypothesis 3: Financial efficacy moderates the relationship between satisfaction with remuneration and financial well-being. The results from this study supported all three hypotheses. Personal financial efficacy and satisfaction with remuneration were found to have a strong positive relationship with financial well-being. The study also established that the relationship between remuneration satisfaction and financial well-being was stronger in people with higher financial efficacy. It is argued that management can intervene with employees financial well-being by improving financial efficacy through financial education and by improving their satisfaction with remuneration. Satisfaction with remuneration can be increased by increasing actual remuneration and benefits, addressing administrative issues of the pay system, addressing staff morale or by increasing financial efficacy. Staff with higher well-being will contribute to the better performance of the entity.


Download data is not yet available.
Abstract 892 | PDF Downloads 1695