Relationship between individual characteristics, neurotic personality, personal financial distress, and financial behavior

Financial distress is not only experienced by people with no income, but also those with a large income. This research aims to examine the effect of individual characteristics and a neurotic personality on personal financial difficulties with financial behaviour as an intervening variable. The study involved 600 Indonesian respondents. The data were analysed using structural equation modelling-the partial least squares method. The results of this study revealed that at an alpha level of 5%, neurotic traits have significant effects on financial behaviour and personal financial distress. The higher the score of a person's neuroticism, the lower their investment consideration, which consequently leads to the tendency of falling into debt and as a result financial distress. Good financial behaviour can mitigate the financial distress faced by an individual with a high neuroticism score.