Behavioral Finance and Financial Literacy: An Evaluation for Teachers

Abstract

According to behavioral finance theories, people are considered as individuals who act through their emotions. As a result of this emotions, individual investors resort to certain Cognitive Biases and Heuristics in their investment decisions. These Cognitive Biases and Heuristics affect the financial investment decisions of teachers. A teacher is a role model for the students. So, it is necessary to analyze the financial literacy and investment behaviors of teachers, which are not adequately examined in the literature. The aim of this study is to determine the investment preferences of teachers, to reveal their Cognitive Biases and Heuristics, and to determine the relationship between investment preferences and financial behaviors. The universe of the research consists of teachers working in public and private schools in Turkey. The sample was determined randomly, and the data were obtained from 517 teachers by online and face-to-face survey. The data were subjected to different statistical tests by the SPSS. Findings show that Cognitive Biases and Heuristics are effective in teachers' financial decisions. Results show that the teachers who got financial education more prone to make more rational financial decisions. Therefore, we understand the teachers should be educated in financial topics more to educate the students financially.