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Theoretical Framework

This document outlines the theoretical framework and conceptual framework for a study examining the relationship between financial knowledge and spending habits among college students. It hypothesizes that increased financial knowledge leads to better spending behaviors. The framework draws on previous research finding connections between financial literacy, money management skills, and financial decision-making. It also discusses how financial socialization at a young age can influence later habits. The conceptual framework identifies financial knowledge factors like savings, literacy, peer influences, and attitudes as the independent variable, and spending habits factors like planning, status, behaviors, and decision-making as the dependent variable.

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4K views

Theoretical Framework

This document outlines the theoretical framework and conceptual framework for a study examining the relationship between financial knowledge and spending habits among college students. It hypothesizes that increased financial knowledge leads to better spending behaviors. The framework draws on previous research finding connections between financial literacy, money management skills, and financial decision-making. It also discusses how financial socialization at a young age can influence later habits. The conceptual framework identifies financial knowledge factors like savings, literacy, peer influences, and attitudes as the independent variable, and spending habits factors like planning, status, behaviors, and decision-making as the dependent variable.

Uploaded by

ranny began
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Theoretical Framework

The study is anchored on the proposition of Sabri and Juen


(2014), financial knowledge has a positive relationship with
financial behavior in spending habits. As people's financial
knowledge increases, they will make the most desirable
behavior in spending habits and avoid themselves getting
involved in financial difficulties. Poor financial literacy or
knowledge will give negative impacts towards people such as
low savings of money will give difficulties for them when they
need some money to meet their needs in a critical financial
situation.

This supported by Dhalia Ibrahim (2009) study reveals that


managing money is a crucial part of attaining quality of life as a
working adult since students' spending habits on campus have an
impact on how they manage money throughout their lives. Other
research found that Norman (2010) insufficient income owing to
a lack of spending expertise due to low financial literacy. That
person is competent to make well-informed spending decisions.
It is not so much about a person's education as it is about
recognizing the worth of money and how he or she spends it.
Furthermore, Taft et al., (2013) personal financial knowledge is
considered as concepts of personal financial management skills
and information. Next, the ability of people to know the
conditions, practices, rules and norms required for performing
financial duties which involve a wide range of daily activities. In
addition, the increasing awareness and knowledge related to
financial instruments and their application in business and
personal life, including how respondents are associated with
saving, financial literacy, influence of peer group, attitude.
These indicators have different domains, and each domain has a
positive impact on people's lives; these domains affect financial
literacy.
Moreover, Gutter et al., (2010), the individuals are
already exposed to various methods of handling personal
finances at an early age, which can often lead to the
development of poor habits. Thus, authors mentioned that
financial behaviors were positively related to social learning
opportunities. They will experience how to deal with such kinds
of challenges until they become an adult and have a job. It
includes several significant spending habits determinants, such
as financial planning behaviors, financial stratus, financial
behaviors, and decision making. Also, these indicators are said
to be the main concern for the researchers.

Conceptual Framework
Relationship among the variables of the current study. The
independent variable in this study is Financial knowledge that
indicates Savings, Financial literacy, Influence of peer group,
Attitude. Savings is income not spent or deferred consumption.
Financial literacy is the ability to understand how money works.
Influence of peer groups is an important influence throughout
one’s life, Attitude refers to a set of emotions, beliefs, and
behaviors toward a particular object.
Relationship among the variables of the current study. The
independent variable in this study is Spending habits that
indicates Financial planning, Financial status, Financial
Behavior, Decision making. Financial planning financial goals
and any strategies you've set to achieve those goals. Financial
Status refers to the state and condition of your finances.
Financial Behavior concerns with a human’s action with respect
to money management. Decision Making refers to making
choices among alternative courses of action.

In this figure it shows about the conceptual framework in which


we the researcher identify the independent variable and the
dependent variable. The independent variable in this study is
Financial knowledge among Tagum College students that
indicates Savings, Financial literacy, Influence of peer group,
Attitude. It is the presumed cause because it can affect the
dependent variable which is the Spending habits that indicates
Financial planning, Financial status, Financial Behavior,
Decision making.
Independent Variable Dependent
Variable

Figure. 1: Conceptual framework of the study.

Significance of the Study


The purpose of this research is to educate students about the
importance of Financial literacy in order to help them be more
knowledgeable about spending habits. This research can help to
educate individuals in the community on the impact of financial
awareness on spending patterns. This study can also enlighten
society on the importance of financial awareness in terms of
managing one's spending habits and efficiently using one's
money. The outcome of this research may give the community
the encouragement to be more knowledgeable about financial
literacy and to change their bad habit of spending money.
In addition, as this research is carried out to determine the
degree of influence of financial knowledge and spending habits
among college students in Tagum city, the outcome of the study
will ultimately benefit the students. The findings of this study
were extremely beneficial to students, since they provided all
students with advice on how to improve their spending habits. It
can motivate and allow them to do a larger phase. The results of
this research could provide a starting point for future researcher
on how to extend the study’s coverage in terms of the variables
covered in the study. It will also benefit the financial
management student as a financial manager in the future; so that
they will know the capacity of financial knowledge of the
teenagers about spending decisions. Lastly, the study’s findings
may provide future researchers stating the point of expanding
the coverage of the research in terms of the variables covered in
the survey.

Definition of Terms
In order for the reader to have a better understanding on the
terminologies Used in the study, the following terms are defined
operationally.
Financial knowledge in this study, this is measured using saving,
Financial literacy, Influence of peer group, Attitude. Financial
knowledge was proposed as an element of personal financial
wellness and comprehension of financial ideas and procedures,
as well as the use of this knowledge to address financial issues
(Joo, 2008).
Spending habits in this study, this is measured using Financial
Planning, Financial Status, Financial behavior, Decision
Making. Spending habits that might influence your capacity to
maintain a balance between needs and wants while
contemplating financial ideas to spend personal things for
pleasure. (Collins,2003

Chapter 2

METHOD
This chapter presents the research design, research locale,
population and Sample, research instrument, data gathering
procedure and statistical tools.
Research Design
This study used a quantitative non-experimental research
design utilizing correlational technique. This method was used
when the objective is to describe the status of the situation as it
exists at the time of study to explore the causes of a particular
phenomenon. Correlational research, a non-experimental
approach, was based on the measurement of quantitative
variables to attempt to determine the existence of a relationship
(Mahowald & Loughnane, 2017).
This study deals on quantitative data about the said
phenomenon. The quantitative aspect is an appropriate schedule
for gathering the designs for the target respondents to answer the
questions. The process of gathering the data was based on the
use of a survey questionnaire. The focus of the study was to
determine the importance of Financial Knowledge and Spending
Habits among college students in Tagum City.

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