Financial Literacy, Disciplined Investing, and Investment Satisfaction: Evidence from U.S. Retail Investors

Abstract

Despite widespread efforts to promote financial literacy, little is known about how such knowledge translates into actual investment satisfaction among individual retail investors. This study investigates the role of disciplined investment behavior as a mediating mechanism linking financial literacy to investment satisfaction in the United States. Using primary survey data from 291 investors, a structured questionnaire measured financial literacy, disciplined investment behavior, and investment satisfaction on a five-point Likert scale. Reliability analysis confirmed strong internal consistency across all constructs. Correlation and regression analyses indicate that financial literacy positively enhances disciplined investment behavior, which, in turn, strongly predicts investment satisfaction. Ordinary Least Squares regression shows disciplined investment behavior as the strongest predictor of satisfaction, exceeding the direct effect of financial literacy. Structural Equation Modeling further demonstrates that disciplined investment behavior partially mediates the relationship between financial literacy and satisfaction, highlighting that much of the effect of knowledge operates through behavioral discipline. Gender-based analysis reveals higher financial literacy among male investors, yet no significant differences emerge in disciplined behavior or investment satisfaction, suggesting that knowledge gaps do not necessarily lead to outcome disparities. These findings provide empirical evidence of the behavioral pathway connecting knowledge to investor outcomes and emphasize that financial education programs should focus not only on knowledge acquisition but also on cultivating disciplined, long-term investment habits.