Uncovering the Financial Literacy among Self-Employed Young Adults of Tangaza University in Kenya

Abstract

Financial literacy plays a crucial role in self-employment and entrepreneurship. The lack of financial literacy presents significant obstacles to the financial stability of self-employed young adults, impeding their ability to effectively navigate entrepreneurship. This study assessed the level of financial literacy among self-employed young adults at Tangaza University, it identified the key financial opportunities and challenges faced by young entrepreneurs, determined the attitudes and practices of self-employed young adults, and explored the effects of financial literacy on the performance of the young adults' businesses. Using a descriptive cross-sectional research design, the study selected 60 students and 20 staff members through purposive sampling and employed semistructured questionnaires for data collection. The findings indicate a moderate level of financial literacy, with a mean score of 66%. Key challenges include exchange rates and managing tax obligations, while the opportunities were market access and networking. Loan accessibility was both a challenge and an opportunity. Young adults had positive attitudes towards continuous learning and improvement, financial empowerment and were optimistic about self-employment. Financial literacy had a significant effect on the performance of their enterprises. Recommendations include targeted interventions to enhance specific financial competencies such as auditing, financing mechanisms, and tax management. Similar longitudinal action research is recommended in other settings such as rural areas.