The Role of Financial Instability, Socioeconomic Status and Financial Hardships on Financial Anxiety in University Students

Abstract

While fears about financial problems have become a well-documented challenge to academic achievement and mental health for university students. This study examines how financial instability, socioeconomic status and financial hardship influence financial anxiety among University students in Pakistan and assesses the perceived stress as a mediator between these financial stressors and financial anxiety. The research employed a quantitative, cross-sectional design with structured questionnaires adapted from validated questionnaires which were distributed through Google Forms and 400 questionnaires were received from valid questionnaires. To test the measurement and structural models, data analysis was conducted in line with the two-step approach of (PLS-SEM) software: The results showed good reliability and convergent validity in most constructs. The study provides theoretical insights in the student financial well-being literature in developing countries and practical policy implications for universities, Higher Education Commission and policy makers on the design of targeted financial and psychological support interventions for vulnerable student groups.