FINANCIAL LITERACY

The Wisconsin Hope Lab recently released a report last 2018 that looked at 43,000 studentsfrom 66
colleges, universities and community colleges from 20 states and the District of Columbia.The survey
found that 36 percent of university students don't have enough money for enough food and 42 percent
of community college students are hungry or not getting a balanced diet (Goldrick-Rab, Richardson,
Schneider, Hernandez, & Clare, 2018).

Learning financial literacy is a promising way to improve financial capacity for today’s young people
(Duquette, 2018).

Students tend not to know what to value first, and they tend to spend it on things that are not
important. That is why, it becomes inevitable for people to overspend when they buy things because
they do not know how to prioritize the significant ones (Paine, 2012).

Not knowing what to prioritize is the time when financial planning comes in. Based on the book "

Financial Management ” by Ferdinand L. Timbang (2015), financial planning is useful for both short-
range and long-range plans. Financial planning serves as a basis of the operations or the allocation
offunds the person has to undergo. Financial planning summarizes in one word: ‘budgeting.'‘Financial
literacy is both an important life skill and a critical intellectual competency an an essential component of
college degree. ( Kezar & Yang, 2015). It is not mandatory to be a professional to be a financial literate,
but one needs to be a person who can maximize present money to gain financial stability. Logically
speaking, it is necessary that students must learn howto handle money as they are expected to earn at a
later stage in their lives.

A study by Acheampong, Kyei-Baffour, Hanson-Cobbinah, & Osei, (2015), about the assessment of
Financial Literacy among University Students, found out that almost half of the population surveyed is
financially illiterate. One reason for the low level of knowledge is the systematic lack of personal finance
education in the college curricula. Given the lack of financial education, it is not surprising that the
results show that university students have inadequate knowledge of personal finance. Another research
paper by Mohd Rahim Ariffin and Zunaidah Sulong (2017) studiesspecifically about the financial literacy
level and students' perception towards saving behavior ofa population, showed that saving behavior,
parental socialization and peer influence had a positive correlation with financial literacy, whereas self-
control showed a negative correlation with financial literacy. In the Philippine economy, prices of the
commodities become higher, and money has gained more value today. Additionally, there are little to no
objects left that cannot be bought by money. It is why it is essential to spend it wisely and to do so; one
must have sufficient knowledge about budgeting (De Guzman et al., 2012).
A namely last 2013 namely: The Relation between Financial Literacy, Financial Well-being and Financial
Concerns that was done by a group of researchers concluded that a positive relationship between the
age and variables of financial wellbeing and financial literacy, marital status and sex and the financial
literacy variable, and education level and financial well-being variable and financial literacy. It has also
stated that a higher level of financial well-being follows financial literacy (Kalantarie-Taft, Zardeini-
Hosein, & Mehrizi, 2013).

Financial illiteracy is a growing concern in both society and the economy. College students,with the
amount of money entrusted to them, are the main subjects of unwise use of funds. To satisfy or solve
the problem of financial illiteracy among students, exposure to sessions, training,and workshops is
necessary. They should be able to gain internet access for it was found out that the internet is where
most students get their basis, knowledge, and understanding.

Valerie

Valerie Torres

A study done by The Money Advice Service in 2017 said that: managing money is seen to be part of
growing up, and young adults are both excited and daunted by this. One in five young adults (22%) of
thesaid study say that they are not confident in managing their money.

Financial knowledge can start at homes. A book entitles “The Money Smart Family System” shows how
parents can teach their children how to save money. It also talks about how each child differs from one
to another. The book states that some children love to spend freely, but some people would rather
watch as their savings grow. Despite the unique traits of each child, the book states that it is possible to
educate them with financial knowledge (Economides, 2012). The study on financial literacy has
continued to gain attention in the field of education and beyond, in today's society financial knowledge
has become an instrument inensuring a financially healthy society (Odek, 2015).

References:
https://www.academia.edu/39729084/Financial_Literacy_of_Senior_High_School_Students_in_Bacolod
_City

Financial Literacy of Senior High School Students in Bacolod City

Valerie

Valerie Torres

EXPENSES OF STUDENTS
Senior high school and college students spend their allowance least in transportation, books and
supplies but most on discretionary activities such as entertainment, clothing and food.

According to the study of Bona (2017), the modern youth are living in the society ofobligation assisted
by luxurious ways of life. These spending patterns represent a danger toyouth’s capacity to deal with
their cash. Based on the findings of the study of Stollak, Vandenberg, Steiner and Richards (2011),the
manner in which students is based on several factors such as age, sex, personality traits and knowledge.
The study shows that younger students or freshmen are more likely to spend moneythan the older
students or freshmen are more likely to spend moneythan the older students or seniors because senior
experiences higher expenses that lead them to create a budget and save.

References: https://www.coursehero.com/file/p5s2jbr/Senior-high-school-and-college-students-spend-
their-allowance-least-in/

According to the Philippine Start, students from exclusive schools like Ateneo and DLSU receive where
surrounding places to eat tend to be more expensive receive higher allowance. The allowance covers
P50 to P100 for lunch, P30 to P50 for merienda, P20 on average for photocopies, and P50 to P80 for
school requirements like printing, buying pens, etc. Students outside of Manila, especially those living in
municipalities usually get about P100 to P150 per day (excluding transport allowance). Transport
allowance is easy to compute, however. student from a single income family notes that she only
receives P100 as an allowance. Even if she deems this insufficient, she notes that she understands that
with the death of her father, it means less resources and she needs to make do with what is given. Her
siblings who are in high school in Ibaan, Batangas receive P30, which is enough for the needs of a
student in a public high school.

The frequency of giving the allowance is another issue. Students who live with their parents usually
receive their allowances daily or weekly. Students who move to study away from their homes receive
theirs weekly or monthly. Consider the cost in terms of time and transaction charges when deciding the
frequency of remiting allowance for children who live away from home.

It is a good idea to teach kids budgeting skills as early as when they are high school. There is nothing
more real than the pain of a grumbling stomach to teach them about handling their finances well.

References: https://www.philstar.com/other-sections/campus/2014/05/26/1327597/breakdown-
students-allowance

Senior high school and college students spend their allowance least in | Course Hero
RRS

Financial literacy is an essential knowledge and skills for young adults to help them in their future goals
and plans to be successful in the future.

Financial literacy provides the necessary knowledge skills and tools for individuals to make informed
financial decision with confidence to manage personal wealth with efficiency and to increase financial
competence to demand for better financial services (Ali 2013)

Financial literacy deals about understanding of the many financial areas(lusardi & Mitchell 2015)
including the topics relevant to managing personal finance money and investing though education. This
is also emphasizing the ability of such person to handle its personal money matters an effective and
efficient way of budgeting.

Furthermore Remund (2016) proposed framework in a definition of personal financial literacy into four
basic categories namely mastery of concepts about finance ( financial knowledge ) aptitude in
management of personal finances (budgeting) making proper financial decisions(financial attitude) and
skillful in formulating effective plans for future needs financially (financial behavior)

Therefore being financial literate person does not limit only to the mastery of the concepts but it is
beyond to it. It is necessary to consider the other important factors influence and interlink to finance
disciplines. Also the capability of one's self to associate concepts to real life decisions play vital role to
obtain financial literacy.Related Studies

Budgeting

One among the important factors that can cause anxiety for most people is the lack of capability
to purchase something (whether it is necessity or mere luxury) for they have not enough money they
can use. This was because people tend to forget about budgeting. Budgeting has a significant role in
order to satisfy individual needs and achieving desired amount of savings as it serves as a guide for the
proper handling of money on hand for better usage. However, as said, many people do not practice
budgeting in their daily lifestyle. This was also visible on the teenagers or students enrolled in schools.
According to the study conducted by Fatoki O. & Thobajane K. (2017), majority of university students do
not have a written budget. In addition, the majority of them spend money on groceries and fast food.
They have also stated that female students are more likely than male students to have a budget.

This also relates to the study of Aung N.N & Mon H.H. (2020) in which findings found that the
budgeting habits of students are different based on gender. The study also showed that the significant
portions of their budget are used to spend on shopping, eating out, mobile phone expenditures,
attending training for their career progress, travelling on short trip with their friends and transportation.
It can be seen that the majority of students lack proper budgeting habits. Their study basically points out
that many students do not have proper budgeting habit. They determined that the practice of budgeting
depends on the gender of a person, in which corresponds to the study aforementioned above
 In addition, one of the reasons of not having budgeting practices may because of student’s lack
of knowledge about personal finance, which can possibly be acquire by undergoing financial education.
However, once again the decision for undertaking or having interest on this finance education depends
on some factors. Student interest in personal finance education is largely a function of perceived return,
time cost, financial independence, and gender where female students have relatively more interest
(Harrington C. & Smith W., 2016).

On the other hand, Johan I., Rowlingson K. & Appleyard L. (2021) said on their study that when
controlling for other factors, the personal finance course did, indeed, have a positive and statistically
significant impact on financial knowledge. However, there was no statistically significant impact of the
course on financial attitudes or behaviors. Their analysis also shows that family financial socialization
was an important driver of financial knowledge, attitudes and behaviors while other drivers of financial
behavior included income, work experience, year/field of study and discussing money with friends. They
do not argue that formal financial education is unimportant but that its role in changing attitudes and
behaviors should be considered carefully. Therefore, although knowledge can be acquired from financial
education, it is not the only source in terms of acquiring habit or interest in personal finance, specifically
for budgeting. This was also evident from the study conducted by Harrington C., Smith W., & Bauer R.
(2017) where they found out that expectations by parents or significant others to budget and feeling
good because of budgeting (positive affect) are significant positive influences on the intent to budget