Money Attitude/Habits

Brian Honigman in his article How Millennials are Shopping (2013) reported that by 2017, Millennials
are hyper-social, continuously connected to social media will have more spending power than any
other generation. This article also mentioned that 84% Millennials depend on user-generated
content has some influenced on what they buy and 51% from the survey showed that Millennials
trust to make purchasing decision based on consumer opinions on company’s websites rather than
recommendations from family and friends.

http://globalbizresearch.org/Malaysia_Conference/pdf/KL539.pdf

Literature outside the U.S: While most studies focus on American college students, some researchers
have extended the literature outside the U.S., highlighting the fact that the financial attitudes and
behaviors of college students are also an international focus. Sabri and MacDonald (2010) analyze
the relationship of savings behavior and financial issues among college students in Malaysia. They
find that financial experience prior to college often fosters poor habits (Sabri & MacDonald, 2010).
As the majority of students first experience financial independence at the university level, there is
overall low financial literacy among the participants. The sample consists of both private school and
public school students, which later proves to be a significant factor in the study (Sabri & MacDonald,
2010). Participants that come from private schools are more likely to come from wealthier
backgrounds, which can account for the high volume of spending among these students (Sabri &
MacDonald, 2010).

https://creativematter.skidmore.edu/cgi/viewcontent.cgi?referer=https://www.google.com/&httpsr
edir=1&article=1035&context=econ_studt_schol

Phau and Woo (2008) investigate money attitudes and credit card usage among Young Australians
using a mall intercept method in a popular shopping complex. Participants of the study are
administered an eight-question survey which asks about demographics, money attitudes,
compulsive buying habits, credit card usage and shopping patterns (Phau & Woo, 2008). It is found
that young adults tend to associate money with a high-status image (Phau & Woo, 2008). Frequent
spending habits are associated with an individual’s desire to achieve a certain social status. As
Australia is a melting pot of cultures, the observed attitudes towards money matters are varied
(Phau & Woo, 2008). Researchers conclude that attitudes and behaviors toward spending and saving
are a function of both age and cognitive maturation (Phau & Woo, 2008). The younger a student, the
less they are inclined to save, as there is no immediate worry of covering financial costs (Phau &
Woo, 2008). There is regard for attaining a constant stream of income that will account for
accumulated debt. This finding by Phau and Woo (2008) provides support for the Permanent Income
Hypothesis. Younger consumers are less mindful of covering costs now, as they anticipate earning
money from a future employer that will allow them to smooth out consumption habits over time.
However, the sample was taken from a single, homogenous Australian population in a popular
shopping complex. It is unknown whether there is an environmental effect factoring into the results
of this study. Conducting a study on financial attitudes and behaviors in a shopping mall may have
adverse effects on consumer responses. Considering that many of the participants had made or
were planning to make a purchase can influence their views on their personal habits, skewing the
results of this study.
https://creativematter.skidmore.edu/cgi/viewcontent.cgi?referer=https://www.google.com/&httpsr
edir=1&article=1035&context=econ_studt_schol

Money is an important issue for people, not only as a utilitarian commodity but also as an
emotional representation of worth or through symbolic meanings (Engelberg & Sjoberg,
2006). Furthermore, money has been recognized as a powerful motivator of behaviour (e.g.,
as a force leading to productivity in organizations), as well as a factor that shapes job
satisfaction and stress. This is to say that your attitude towards money may shape your
knowledge financially. How someone value money will eventually have an impact on his/her
literacy financially. One's thought about money will as a result influence his/her ability on
money management. Consequently, having a positive attitude towards money will influence
someone to have a more financial understanding and literacy whereas a negative attitude
will lead to poor management, knowledge and financial ruin. In a study among college
students, Edwards et. al (2007) highlights that money attitude is related to children being
open about their financial situation with their parents. By having a positive attitude towards
money, students will feel concern about their current situation and they will want to know
how to successfully manage the finance in order to remain stable. They will have a proper
interaction about financial matters with their parents.

Specific money attitudes were related to self-direction and security values, implying that
those attitudes likely interact with a self-directed behaviour for security such as financial
knowledge seeking (Burgess, 2005). It all depends on how the students value money or
financial security in order for them to seek knowledge about how to manage their savings
and spending. This may trigger the need for youngsters to acquire skills required for having
a better ability in terms of financial behaviour and literacy.

Moreover, in this modern society, religious and moral values are becoming less important
and the world is turning into a more materialistic importance whereby youngsters are more
concerned with earning money rather than believing in conventional beliefs of their
forefathers. Thus, money is an important aspect of one’s life nowadays and this may act as
motivation for students in order to become more financially literate than previous
generations. Kim (2003) later identified money as a tool of safety which triggers the
motivation for a better money management in the future. Everyone wants to be safe
financially and without being properly literate financially, it would be a waste of time.
Kidwell and Turrisi (2004) researched on the budgeting tendencies of students and found
that those students who were highly confident about their skill to keep a budget were likely
to justify reasons for budget. These students perceive money as “normative expectancies”.
Contrarily, those students who had lower perceived control over their budget relied on their
emotional feelings towards budgeting, rather than their cognitive beliefs about budgeting.
As we can see, it will depend on how the student perceives money in order for them to be
able to set an appropriate budget for themselves. If an individual value money and know
that this is one of the most important assets he/she can possess, then they will do their
maximum to maintain a particular budget in order to smoothen their expenses. Relying on
emotional feelings for keeping a record of one’s budget is fruitless as it will result only into
failure in maintaining a good record of one’s transactions.

garleghi