Development and Validation of a Questionnaire to Assess Household Financial Well-Being and its Determinants in Sri Lanka.

Abstract

This study develops and preliminarily validates a multidimensional questionnaire to assess household financial well-being and its key determinants financial knowledge, financial education, and financial behavior in the Sri Lankan urban context. Grounded in financial capability theory and consumer finance literature, financial wellbeing is conceptualized as an integrative construct that combines objective financial conditions with subjective perceptions of financial security and satisfaction. Measurement items were derived from established international scales and adapted to local socio-economic conditions. Data were collected through a structured questionnaire administered to households residing in a selected condominium in Colombo, and the psychometric properties of the instrument were evaluated using reliability analysis, exploratory factor analysis, and preliminary discriminant validity assessment based on the Fornell–Larcker criterion. The results indicate satisfactory internal consistency across all constructs, with Cronbach’s alpha values exceeding recommended thresholds, and support the proposed multidimensional structure of financial well-being, financial knowledge, financial education, and financial behavior. Although the study is constrained by a relatively small sample size, the findings provide strong preliminary evidence of the reliability and validity of the developed instrument. The study contributes a contextually grounded measurement tool that can support future confirmatory research, policy evaluation, and financial education initiatives aimed at enhancing household financial well-being in emerging economies.