UNIVERSITI for some, vehicles outside the basic



CODE: UHB30102
AFFANDI (AP160035)
Chapter 1
Spending habits have never been stable, especially among university students.One of the challenges they face is budgeting in their money spent. Living in a university is a change from childhood into adulthood that makes student life more challenging and tougher because they need to make a decision for themselves. In the ages past, book stationeries, clothes,and other similar items for study were bought by the students. In the present time, student’s needs have increased for sure, when laptops and others gadgets are needed for assignments and for some, vehicles outside the basic necessities that a student should own. Due to the existence of Tesco at Parit Raja, has attracted UTHM students to buy their necessities easily. The items sold in Tesco are also quite affordable and cheap compared to the other supermarkets. But Tesco also has actually impacted student spending habits.

There are many groups of students that spent their money differently especially among gender. Its look on how students manage their education’s money that they get whether from scholarship, loan or by parent. According to Wang and Xiao (2009), females tended to spend more money on clothes, while men spent more money on entertainment and eating out. The family background, attitude, and financial aid are seems to have an impact on university student spending habits.
Therefore, the aim of this study is to examine the spending behaviors and financial literacy level among UTHM students and to determine the factors which influence students’ spending habit patterns. By assessing the financial literacy level of students, we can understand better about the spending habits of the students. The detail about the design of study is described further in this research.
1.2Background of Study
Spending habits cannot be separated from the daily life of the people due to the rapid change of the competitive global business environment. It resulted the decision-making has become complicated and more complex. This phenomenon impacts the students’ life as they exposed to advertising campaigns, internet provider and electronic purchasing facility.

According to social learning theory, spending habits defined as a learned habits that influence by parents and other influential individuals. Therefore, predominantly, one that is passed from generation to generation. In the United States, Spending by the students have been identified as an important component of total consumer spending. Wong & Smith (2002) stated that the students are one of the most important markets for many businesses based on the size and characteristic of the market. Ring (1997) concluded that the full time students spent $23 billion on essential items such as books, tuition ,food and rent, whereas another $7 billion was spent on nonessential items such as accessories, fashion and entertainment.

Spending habits has never been stable. It changed over the time, especially among university student clothes, printing and stationery, books, food, groceries and others. Nowadays, many of students spending more money on nonessential item such as accessories, fashion and entertainments. It can affect of spending habits and easily influenced by their wants rather than their needs. 
This study also is mainly focus on the student’s personal financial literacy, and there was a group of studies, which participants answered questions related to general financial knowledge through the questionnaire survey. (Manton et al, 2006; Chen ; Volpe, 1998; Jones, 2005). Besides that, we also look into the student’s demographic variable including social background, financial attitude, financial knowledge and family sophistication (Chen & Volpe, 1998; Ibrahim, Harun, & Isa, 2009).
Financial literacy can have important implications for financial behavior. For instance, people with low financial literacy are more likely to have problems with debt (Lusardi & Turfano, 2009), less likely to participate in the stock market (Rooij, Lusardi, & Alessie, 2007), less likely to choose mutual funds with lower fees, less likely to accumulate wealth and manage wealth effectively and less likely to plan for retirement (Lusardi & Mitchell 2006).UTHM students must have financial literacy to survive as students.Financial literacy is important to prevent being burdened with education debt.Those who lack knowledge in financial planning tend to overspend. 
1.3Problem Statement
Financial illiteracy is one of the major worries specially among university student. Financial literacy also defined as the ability to read, interpret and analyze, manage the money, communicate about the personal financial condition that affect material well- being, compute, develop independent judgments, and take actions resulting from those processes in order to thrive in our complex financial world (Vitt et al., 2000). Thus, financial illiteracy leads to poor financial management among UTHM student as their lack in financial knowledge implicate to the practice irresponsible spending habits and risk of bankruptcy, debt and financial crisis.
Moreover, advances in technology have as well led to increases in student’s expenses.Male students in particular are attracted to buy gadgets that are known to be costly, while the females more likely spent on shopping for clothes, bags and shoes are thought crucial, because they want to look nice going to classes. Financial management is an important aspect of our daily life involving cash flow and liability management. The more knowledge students have about their financial responsibility and status the less likely they are to be in debt (Norvilitis, et al., 2006).Our problem area is university students’ financial literacy level and factors towards spending habits will determine who have the bad and good spender between the gender, the student’s level of awareness in financial knowledge and also factors that influence student to spend their money. Hopefully, this information about the factors of student’s spending habits and their level of awareness in financial knowledge will help in reducing the bankruptcy cases among young generation in Malaysia and also help in developing of economic performance in Malaysia.

This study focuses on the Examining student (According to Gender) Spending Habits at Tesco. There are two objectives, which needed to be taken into consideration in carrying out this study. All these objectives are mentioned as follows:
To examine the spending behaviors and financial literacy level among UTHM students.

To determine the factors which influence students spending habit patterns.
1.5Significance of the Study
The result of this study are significant because it will reflect the attitude of UTHM students spending habits at Tesco. By having such information, students can better manage their financial management. The finding from this study can also help in manage their spending habits wisely. In the final analysis, it is hoped that UTHM students will make better decision in their spending habits.
Chapter 2
2.1Literature Review
There are few researches carried out to test on the difference between the gender and their financial literacy. These include Chen & Volpe (1998), Danes & Haberman (2007), Manton et al. (2006), Micomonaco (2003), Peng et al. (2007) and Volpe et al. (1996), who found out that male scored better in the financial knowledge compared to the female. However, there is also a different finding in which Ibrahim et al. (2009) found out that there is no difference between the level of financial knowledge between males and females students. It means that the gender of students did not give any difference to their spending habits.

Another research said that the attitude of young adults toward spending plays a vital role in sustainability perspectives of their finance and is a significant variable in financial prudence (Pillai et al., 2010). If students have the idea of managing their finances, there will be less default rate on their student loan debt (Cummins et al., 2009). Besides, students with high financial literacy enable them to decreases their chances of bankruptcy, receiving government assistance (Huston et al., 2003) and making poor consumer decision (Hayhoe, Leach, Turner, Bruin, & Lawrence, 2000).
Furthermore, financial education plays a significant role in how students make use of their money and their credit. Graduating students leave college with an average of $20,402 in education and credit debt (Robb and Sharpe 2009). The amount of credit card information and education given by parents is greater than any other socialization agent. Mothers and fathers are the two most important sources of influence on college students’ money beliefs and attitudes. There is a correlation between the amount of credit card information learned from parents and student credit card use. Students who had a lower credit card balance were more likely to be educated by their parents about proper spending and credit debt (Pinto, Parente, and Mansfield 2005).
2.2The Definition of Terms
1. Financial Management – Financial management focuses on ratios, equity and debt. Financial managers are the people who will do research and based on the research, decide what sort of capital to obtain in order to fund the company’s assets as well as maximizing the value of the firm for all the stakeholders
2. Gender – The state of being male or female (typically used with reference to social and cultural differences rather than biological ones).

3. Spending Habits – Define as the amount that individuals and households spend on goods and services at which they do so.

4. Attitude – A feeling or opinion about something or someone, or a way of behaving5. Financial Literacy – Is the possession of the set of skills and knowledge that allows an individual to make informed and effective decisions with all of their financial resources.

6. Financial Aid – Is any grant or scholarship, loan, or paid employment offered to help a student meet his/her college expenses. Such aid is usually provided by various sources such as federal and state agencies, colleges, high schools, foundations, and corporations.

Chapter 3
3.1.1 Sample
The target population of our study is among undergraduate students in University Tun Hussein Onn (UTHM), Parit Raja. We select a random student with random faculty in UTHM based on their gender. We only aim 20 respondents which are consist of 10 male and another 10 female students.

A survey questionnaire was used to collect the data for this study. The survey questionnaire was taken from Hamida Bee (1996). The questionnaire consisted of 20 items. Respondents indicated their level of agreement to each item in the instrument based on a 5 point likert scale, ‘1’ indicating very strong disagreement and ‘5’ indicating very strong agreement. This survey conducted to measure the spending habits among UTHM student and the aim of this study is to examine the spending behavior financial literacy level among UTHM student.

3.1.3Data collection procedures
The survey questionnaire was administered to the sample and verbal instructions were given to the students apart from the written instructions on the forms to ensure that the survey questionnaire was responded to correctly.

3.2Limitation of the Study
This study was limited to UTHM students only. As such, the findings may be generalized as representative of the whole student population in UTHM which is include all faculty in UTHM.

1. Allen, K. (2009). Financial Management Practices of College Students. Global Journal of Business Research, 3(1), 105-116.
2. Chen, H., & Volpe, R. P. (1998). An analysis of personal financial literacy among college students Financial Services Review, 7 (2), 22. Retrieved from http://www2.stetson.edu/ fsr/abstracts/vol7num2107.pdf3. Dr. Rekha Attri. (2012). Spending And Saving Habits Of Youth In The City Of Indore.
4. Ibrahim, D., Harun, R., & Isa, Z. M. (2009). A study on financial literacy of Malaysian degree students. Cross-cultural Communication, 5 (4), 9. Retrieved from http://cscanada.net/index.php/ccc/article/view/1142/1235
5. Norasikin Hj S., Norailis Ab. W., Nurazalia Z. & Siti Nurulhuda N. (2013). 4th International Conference On Business And Economic.Research Spending Habits Of Malaysian Muslim Teenagers: Evidence Of Malaysian Public University.

6. Shahryar Sorooshian & Tan Seng Teck. (2014). Asian Social Science. Spending Behaviour of a Case of Asian University Students; Vol. 10, No. 2. Student Budgeting and Spending.Student budgeting and spending behaviors: a comparative study


I'm Mary!

Would you like to get a custom essay? How about receiving a customized one?

Check it out