Theoretical Framework:

People must be able to make wise financial judgments in a market that is

becoming more hazardous and international. Financial illiteracy is pervasive,

according to recent worldwide studies, in both highly developed and dynamic

economies. The young and the old are less financially literate than the middle-aged,

while better educated persons are more financially savvy. Women are less financially

literate than males. In particular, those who are financially savvy are more likely to

make retirement plans. Estimates of instrumental factors reveal that the influence of

financial literacy on retirement planning is frequently understated. In conclusion,

financial knowledge is essential to retirement security everywhere.

Figure 1: Theoretical framework of Financial Literacy

 The theoretical framework that underpins this study, which comprises a three-

part procedure and is depicted in Figure 1, is as follows: the profile of the respondents

is based on their age, gender, rank and length of services. As inputs, the level of

awareness to financial literacy will be measured through their investment procedure.

As well as the level of financial decision, to provide concrete data and fill the gap of

the study. In addition, the study wants to know the relationship between financial

literacy and investment decision of the respondents. Furthermore, this study aim to

determine the Financial Literacy on Investment Decision of Philippine National

Police in District 2 Davao Oriental.

As stated by Aren et.al (2020), today, the value of financial literacy is rising.

Knowledge of finance, especially in the economic and financial worlds, is very

helpful in describing diverse economic and financial behavior. Economic agents'

ability to grasp basic financial concepts and make decisions is greatly influenced by

their level of financial literacy. People have been more accountable for their financial

planning throughout time and are now more active agents than before. In reality,

given that previous crises disproportionately hurt the young and inexperienced, this

heightened accountability may have originated from a humanistic urge to protect

oneself.

In addition,financial literacy is the capacity to comprehend financial issues.

consisting of a collection of abilities and information that enables an individual to

make decisions. Their awareness of money allows them to make educated and

successful judgments. It is related with a collection of attitudes, behaviors, and

knowledge that are crucial for financial decision making. These decisions include

whether to save, when to spend, budgeting, selecting the correct financial products,
and being willing to address other events such as paying children's education and

retirement planning. The greater people's financial literacy, the greater their advantage

since it allows them to make better financial decisions and provides them more

control over their money.

Reference:

Aren et.al (2020), A Literature Review On Financial Literacy. Retrieved from:

https://www.researchgate.net/publication/267641595_A_Literature_Review_O

n_Financial_Literacy