Journal of Applied Finance & Banking

Personality, Risk and Financial Planning: A Consigned Credit Analysis

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  • Abstract

    This article examines Brazilian Navy personnel's psychological and behavioral characteristics in the context of credit risk, the consigned credit, utilizing multiple linear regressions and correspondence analyses. Incorporating personality traits through the Big Five model, the research considers various sociodemographic and military characteristics. The payroll-deductible loan sample comprises individuals with high financial planning and above-average or high-risk tolerance. This research contributes novel insights by integrating personality traits as determinants of military indebtedness, financial planning, and risk tolerance. The study reveals that the personality trait "openness to experience" positively impacts financial planning, indicating a tendency toward financial discipline. Women, older individuals, and those with less service time exhibit a riskier financial profile. The research identifies a lack of basic financial knowledge among indebted military personnel, underscoring the need for interventions to address this issue. Financial planning and risk tolerance are critical factors influencing decisions, reflecting broader societal challenges of increasing indebtedness and financial illiteracy.


    JEL classification numbers: D14, G21, G32.

    Keywords: Credit Risk, Personality Traits, Risk-taking, Consigned Loans, Military Personnel in Brazil.