THE RELATIONSHIP BETWEEN FINANCIAL LITERACY LEVEL AND SPENDING

AND SAVING HABITS OF GRADE 11-ABM STUDENTS

In partial fulfillment

for the requirements for the subject

Practical Research 2

(Quantitative Research)

Beltran, Robelyn R.

Fernandez, Mhea Rose N.

Gabriel, Jessica E.

Limon, Theresa B.

2022
 Chapter I

THE PROBLEM AND ITS BACKGROUND

Introduction

People become more responsible as they mature into adults in a variety of ways, most notably

in financial matters. As young adults begin to earn money, it is critical that they apply there own

financial literacy knowledge in order to manage one’s earnings. Personal financial management,

investing, budgeting, and taxation are examples of financial concepts and abilities that require

financial literacy (Team CFI, 2021). Knowledge of financial management is important not only

for oneself but also for those around them. By having a basic understanding of money and being

financially literate, anyone can be aware of there own finances, specifically one’s spending

habits and where one’s money goes. Furthermore, being knowledgeable about people’s finances

may have a positive impact. Additionally, being literate about the finances of the people could

have a better result. As stated by Askar (2020), there will be an improvement in investment,

income, savings, and behavior if a person is financial literate. There would also be an increase of

total consumption and total income of the people.

Being financially savvy from an early age will help make wiser decisions regarding

expenditures. Financial literacy aims to give a sense of control over one's finances and the

freedom to use money as a tool to make decisions that will improve an individual's quality of life

(Mcgurran, 2021). The goal of financial literacy is to be able to manage costs and build a strong

sense of control and security with money. To better define income goals and manage

expenditures, it is important to allocate revenue to certain uses. In order to start at an early age in

improving understanding regarding financial concerns, financial literacy is vital, particularly

that's why nowadays younger generations are encouraged to be financially literate at such a

young age.

Corresponding to the financial savings of the students, lots of them have financial problems.

Their money have been spent on food, transportation, activities, and projects. Based on the study

of IPL (2022), students that have problems in financial especially if their parents are not that

rich, could lead them to be unknowlegeable in saving money as they are not sure about the

money that they can get from their parents. The balance between socioeconomic status and the

management in money are both having the conflict with each other. Additionally, most of the

students that have money has no knowledge in planning their everyday allowance. Based on Red

Star Education Blog (2016), lot of consumers especially the students lessen their ability to be a

productive part of the environment, knowing the risks in financial problems, cannot secure

money for the future, and it can also affect the mental and physical state of a person. Lot of

students spend their money without hesitation that leads them to be illiterate.

In financial literacy, there are also related spending and savings of the students. As stated by

Khumalo (2021), there were some of the things that the students should do in order to be wise in

spending and savings such as having a track in own expenses, saving money for emergency, and

avoiding the behavior of being impulsive buyer. Moreover, based on Perdido (2016), a habit of

high spending and low saving can cause a financial irregularities. Expanding the knowledge of

efficiency in saving and spending their allowance could lessen the circumstances that would

affect in the future.

The researchers are able to conduct surveys to the individuals through this approach and are

able to make sense of the different perception of individuals. The research revolves around the
relationship of being financial literate and spending and saving habits of students of Anao Senior

High School under Grade 11 Accountancy, Business, and Management. The research has an aim

of understanding the correlation of being financial literate among students and the spending and

saving habits. The study does not cover the comparison of the two variables as it is conducted via

survey and it is a correlational study.

Statement of the Problem

Generally, this study aims to define the relationship between financial literacy level and

spending and saving habits of Grade 11-ABM students.

Specifically, the researcher seeks to/aims to answer the following questions:

1. What is the profile of the respondent in terms of:

1.1 age;

1.2 sex; and

1.3 socioeconomic status

2. How is the level of financial literacy among Grade 11-ABM be described in terms of;

2.1 financial knowledge

2.2 financial behaviour; and

2.3 financial attitude

3. What is the level of spending and saving habits of Grade 11-ABM students?

4. Is there a significant relation between the spending and saving habits of Grade 11-ABM

students?
Scope and Delimitation

The general intent of this study is to define the relationship between financial literacy level

and spending and saving habits of Grade 11-ABM students of Anao Senior High School. This

study will be conducted during the School Year 2022-2023.

Respondents profile are being assessed in terms of; age, sex, and socio-economic status which

will help this study evaluates the relationship between financial literacy level and spending and

saving habits among subject of this study.

The researchers will collect data and information from Grade 11 students enrolled in the strand

accountancy, Business, and Management (ABM), which is the subject of the study.

Significance of the Study

This study will be conducted to define the relationship between financial level and spending

and saving habits of Grade 11-ABM students. The result of this study has a valuable contribution

to the following;

To the students, as the primary participants of the study, they will give more knowledge about

the allocation of their allowances. They will also be able to cut costs in their daily lives in order

to better manage their budgets. Furthermore, this can heighten their awareness of how they

handle money.

To the parents, they are a student's main source of financial support for both school and

personal life. This study can shed light on the budgeting abilities of youth in a specific age range.

The study could also help parents understand where teenagers spend the most money, how they

spend it, and when they spend it. Furthermore, the study promotes early financial management

education, which is likely to begin at home.

budgeting and expenses. Teachers can help their students not only academically, but also

financially, by assigning low-cost projects.

To the future researchers, they will know more about the topic and broaden their knowledge in

the said field. They will be able to craft better questions and engage with other participants. They

will then gain confidence in their answers and achieve better results. They can also aid in the

understanding of the factors influencing students' spending and saving habits, as well as the

correlation with various variables.