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Published by zakwan1307, 2023-01-02 04:22:01

Savings Behaviour & Financial Problems Among Students

KMU1013_E-Magazine_Group 05

KMU1013

FINANCIAL
ISSUES

5

GROUP DECEMBER

WHAT

is finance?

PROBLEMS

The financial problems among
students

CAUSE AND IMPACT

The cause and impact of
financial problems

SOLUTION

How to solve financial problems

IMPORTANCE

The important of having good

financial

BENEFITS

The benefits of financial

management

MYR RM24.00 GB €5.00

IT €5.00 USA $10.99

FR €8.00 JP ¥2,310

CONTENTS
December 2022

01 What is Finance?

02 The Financial Problems
among Students

03 Causes and Impacts of
Financial Problems

04 How to Solve Financial
Problems

05 The Importance of Having
Good Financial

06 Benefits of Financial
Management

Group Member(s):
Harith Zakwan Bin Zakaria (73484)
Azreen Shafieqah Binti Asri (74251)
Iman Tarmizi Rosalina (73496)
Nur Sufikah Binti Abdul Razak (80695)
Mohammad Amir Alam Bin Rahim Omar (73563)

Editor's Note

Dear Readers,

I hereby present to you the Savings Behavior & Financial Problems
Among Students E-Magazine with its theme revolving around the
issues that students face in terms of financial outlook. As you scour
through the pages, you are able to read and learn the aspects that
involves finance in the shoes of a student. I hope you are able to take
the time to read and enjoy what this magazine has to offer!

I would like to each and every member of the group for their
contributions and efforts in realizing this magazine. I would also like to
thank our lecturer, Dr. Salmah Binti Mohamad Yusoff for her diligence
in providing proper guidance in every aspect to produce this
magazine throughout the semester.

Enjoy!

03

Excellent Tips
by Warren Buffet

ON EARNING

Never depend on single
income. Make investment to
create a second source

ON SPENDING

If you buy thins you don't
need, soon you will have to
sell things you keep

ON SAVING

Don't save what is left
after spending, but spend
what is left after saving

ON TAKING RISK

Never test the depth of
river with both feet

What is Finance?

Finance is the management of Corporate finance is concerned
money, which encompasses
actions such as investing, with a corporation's capital
borrowing, lending, budgeting,
saving, and predicting (Corporate structure, including its funding and
Finance Institute, 2022). There
are three main types of finance the activities taken by management
such as personal, corporate,
and public or government. to raise the company's worth.

Corporate finance also

encompasses the tools and analyses

used to priorities and allocate

financial resources.

Personal finance refers to all Public finance is the way of
budgeting, saving, investing, and managing the nation's public funds.
planning activities based on a It is critical to the country's
person's existing financial limits domestic and international growth
and skills. Personal finance is and development. It has an impact
highly tailored to each individual's on both citizen and non-citizen
unique financial situation. stakeholders in the country.
However, it is usually determined
by their annual earnings or wages, However, in this magazine, we are
living needs and expenses, going to focus on personal finance
objectives, and lifestyle especially among college students.
preferences.
04

The
Financial
Problems

Among
Students

Low saving and no
emergency fund

College students may not develop the
practise of saving a portion of their
allowance or pay. They continue to
spend as if there is no tomorrow.
Saving money for an emergency fund
provides a financial safety net while
also making room for discretionary
expenditure later.

Don't have enough money
to buy food

Some college students report "food
insecurity," which means they have
limited or unclear access to
nutritious food. These students
frequently skip meals or going
without food. This could affect the
student's health.

05

Could not afford to pay for basic needs

College basic needs such as books, stationeries and classroom
supplies are the examples of some students could not afford to buy it.
With the increase in pricing each year, it becomes more expensive to
buy necessities for school. They also find it difficult to pay for housing
rent every month since they only have limited source of income. Most
students struggle with staying within their budget for school
necessities and they end up going over budget than the amount of
budget they allocated to buy it.

“Money is a
terrible master
but an excellent
servant.”

-P.T. Barnum

Blindly following the High uncontrolled
herd spending

College students sometimes The most prevalent mistake made
overspend in order to keep up with by students is overspending when
their peers. It is critical to avoid it is not necessary. These could
peer pressure when shopping. include buying designer clothes,
Spend only within your monthly shoes, or watches when a less
budget and avoid competing with expensive brand will suffice.
your friends. Money management
requires financial prudence. 06

KMU1013

JUST BECAUSE YOU
HAVE THE MONEY TO

BUY SOMETHING
DOES NOT MEAN YOU

SHOULD

SPEND MINDFULLY

Causes of Financial
Problems

Spendthrift Attitude "the spendthrift robs
his heirs,
Spendthrift attitude refers to the behavior
of spending money in an excessive manner. the miser robs
The habit of spending money excessively himself,"
may tie to students’ mental health as Mind
(2022) stated that one of the ways mental

health is linked to spending behavior is that
spending gives a brief high which leads to - Jean De La Bruyere
overspending to make one feel better of
themselves. This is also supported by Secondary Socialization
Furnham et al. (2022) who state
spendthrifts tend to have a compulsive and
uncontrolled habit of spending their money
whenever they are feeling depressed,
worthless and rejected.

Secondary socialization can be defined as
the process of learning of behavior outside
the involvement of family and the agents can
include friends, teachers or media. Among
students, secondary socialization agents
mostly consist of fellow peers and mass
media. According to Falahati and Paim (2011),
students who are more affected by
secondary socialization agents in financial
issues are more involved in financial
problems as it is documented that students
who revere their peers and media as
financial information source had riskier
financial management which can lead to a
higher level of financial stress and problems.

07

Impacts of Financial
Problems

Academic Performance

Financial problems can affect a student’s
academic performance to a significant
degree and this is due to the worsening
state of the economy directly affecting the
financial situation of tertiary students which
causes an increasing trend of working
students (Mofoka, 2016). For instance,
students with low financial stability would
require partaking in working part-time to
cater their lack of adequate savings.
However, working would take a toll on their
academic performance as time and energy
is spent on working rather than their
studies as supported by Mofoka (2016) who
states working students were found to
perform worse than non-working students.

Self Wellbeing

According to Mofoka (2016), adverse
academic performance, physical health and
mental health is associated with financial
stress which is something that is commonly
experienced among tertiary education
students. Moreover, poor economic
conditions affecting communities, in this
case, students, can damage self-esteem
which can result in depression (mental
health), use of drugs and violence (physical
health) which further contributes to poor
academic performance (Nnanami et al., 2014,
as cited in Mofoka, 2016).

08

8 signs you are good

with money

Have a steady flow of
income
Know how much you
spend
Can pay bills every month
Can buy things you want
Have an emergency fund
Planning for a major
purpose
You are saving money
Invest to make more
money

IT'S NOT
ABOUT HAVING

LOTS OF
MONEY. ITS
KNOWING HOW
TO MANAGE IT

How to Solve
Financial Problems

Make a budget

Write down all of your income and all of your

expenses.

To avoid underestimating your expenses, save all of

your bills and receipts for a month.

Also consider occasional expenses like

gifts,vacations,school supplies. Don't forget to budget

for paying off your debts. Lower your expenses

Analyze all of your expenses to see
which ones you can reduce or eliminate

Think about reviewing various packages,such as your
telecommunication services. You could save by ensuring all
they do is meet your needs-nothing more and nothing less.
You could also start looking for deals, make a food budget &
limit the cost of eating out by packing your own lunch.

Pay in cash

Paying in cash can help you stick to your budget.
Debit card and credit cards are convenient, but they
can make it harder to track your expenses.
BUDGET TIP : Put your cash in seperate envelope for

groceries, entertaiment and clothing.

Build an emergency fund

Having money set aside for an emergency such as car repairs, job

loss or illness can go a long way towards relieving financial

anxiety. However, building an emergency fund can seem

overwhelming, especially one with enough to cover 3 to 6 months

of expenses. Don't get hung up on the amount! What's important

is that you're consistently setting money aside. 09

The Importance Of Having
Good Financial

Students can properly organize their spending and
savings

Students can better manage their money through
financial literacy. Students can use a budget to
determine how their income will be spent, including
how much will be spent on necessities vs how much
will be saved or invested. Stick to what you've
budgeted, prevent overspending, and put the rest of
your money into savings, as outlined in your student
lifestyle plan.

“Debt is worst
poverty”

-Thomas Fuller

Money from savings and investments can be used to
get you out of a situation. Students' knowledge of
money may be restricted to paying monthly
expenditures like rent or a mortgage. However, if
students learn to manage their money responsibly,
they'll be able to save more and spend less. That way,
they can see exactly how their money is being
spent. You can save the money you'd normally spend
on these items if they aren't necessary.

10

Preparation in the future

It is important for college students to learn how to properly
manage their finances to better prepare themselves for their
futures. This is because managing money will become even more
difficult once students enter the working world, and the current
economic crisis is one of the primary sources of stress for
students.

" The

FUTURE

depends on what we
do in the

PRESENT "
-Mahatma Gandhi

According to the findings of a study that was carried out in 2001 by

researchers Roberts and Jones, some students already had credit

card debt when they started their higher education. They found that

62% of entering college freshmen had access to a creditor charge

card, and 50.9% had some type of debt. This increases the likelihood

that students may experience financial difficulty before they enter

the workforce. In addition, effective management of financial

resources helps students feel less stressed and better prepares

them to deal with more difficult financial circumstances.

11

DON'T BUY THAT
RM300 BAG TO HAVE
NOTHING IN IT. BUY
THAT RM10 BAG AND
HAVE RM290 IN IT

DON'T GO BROKE TRIYING TO LOOK RICH

The Benefits of Financial
Management

Achieving Financial Goals

Each student has financial goals. Others could strive to achieve their own goals, such
as buying their own shoes, clothes, or gadgets, while some may aspire to be
independent of their parents. They can still save money each month for these goals
without a savings plan, but their calculations will be inaccurate. The amount of money
that students will need to reach a goal is fixed in a savings plan. Students can plan
their finances appropriately when they configure a plan to include their goals and the
age at which the target should be attained. By doing this, they can be confident they
won't blow their budget before they succeed. It can assist students in spending less
and making wise financial decisions.

Differentiating Between Needs and Wants

In particular, when students attempt to live like many others, college life can be

stressful. They might be unable to distinguish between such a desires and a need. It's

acceptable to be inspired by how everyone else currently reside. However, if it can

result in unfair analogies that could cause financial disaster, a stop sign needs to be

placed. How can students identify the distinction among both desires and wants? For

instance, they would want headphones like someone else and need to buy a book.

Students can distinguish between the two with good financial planning. Financial

planners are always capable of automatically differentiate between what they require

and what they desire. 12

References

Better Money Habits. (2022, August 5). 6 tips for handling financial stress. Better Money Habits.
Retrieved December 31, 2022, from
https://bettermoneyhabits.bankofamerica.com/en/debt/how-to-overcome-financial-problems

Corporate Finance Institute. (2022). Finance Definition. Retrieved from
https://corporatefinanceinstitute.com/resources/wealth-management/what-is-finance-
definition/

Financial Express. (2020). 15 common financial mistakes college students make and how to avoid
them. Retrieved from https://www.financialexpress.com/money/15-common-financial-mistakes-
college-students-make-and-how-to-avoid-them/2100733/

Furnham, A., Robinson, C., & Grover, S. (2022). Spenders and savers, tightwads and spendthrifts:
Individual correlates of personal ratings of being a spender or a saver. Journal of Neuroscience,
Psychology, and Economics. Advance online publication. http://dx.doi.org/10.1037/npe0000155

Jackson, A. (2020, December 1). Why Is Financial Planning Important For Students. The Next Tech.
https://www.the-next-tech.com/finance/why-is-financial-planning-important-for-students/

Klepfer, K. Cornett, A., Fletcher, C., & Webster, J. (2019). Student Financial Wellness Survey Report:
Fall 2018 Implementation. Trellis Company

Leila Falahati, Laily H. Paim. (2011). Toward a framework of determinants of financial management
and financial problems among university students. African Journal of Business Management,
5(22), 9600-9606.

Mofoka, K. G., (2016). The effects of tertiary students' financial problems on academic
performance: The case of Motheo Technical Vocational Education and Training in Bloemfontein.
University of Kwazulu-Natal.

Money and mental health. (2022). Retrieved from https://www.mind.org.uk/media/12440/money-
and-mental-health-2022-pdf.pdf

Robert, J.A. & Jones, E. (2001) Money Attitudes, Credit Card Use, and Compulsive Buying Among
American College Students, Journal of Consumer Affairs. 35(2), 213 - 240.
https://doi.org/10.1111/j.1745-6606.2001.tb00111.x

10 tips for resolving your financial problems. National Bank. (2022, August 26). Retrieved
December 31, 2022, from https://www.nbc.ca/personal/advice/credit/tips-financial-
problems.html

What are the Benefits of Financial Planning? (2021, September 23).
https://www.canarahsbclife.com/blog/financial-planning/what-are-the-benefits-of-financial-
planning.html


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