Personal Financial Management Among the Grade 12 HUMSS and GAS in CCNHS-

Annex (L.R SEBASTIAN SITE)

In Partial Fulfilment of the subject Practical Research 2

Kaye Ann S. Tajolosa

Mary June H. Salem

August, 2019
INTRODUCTION

Financial experts agree that while people have much more money today than

they did generations ago, the amount of knowledge on how to manage that money

hasn’t kept pace- not at all (Maura, Fogarty. 2012).Every human being should have

awareness in terms on financial aspects and as well as knowing the importance of

their personal financial management. Taking charge of managing our finance and

implementing it well is very important not to the students only but of course also in all

people who have the capability to use money. We must know how to control our own

money. It is important as individual would like to be free in debt and will not suffer

through stressful life.

Personal financial management helps us to manage our self which include

budgeting, saving, investing, debt management and other aspects in life that are

related to any personal money where you can handle all your prospects. In other

words, personal financial management is the process controlling income and

organizing expenses through a detailed plan. Learning to keep a track of money

coming in, and tailoring the use of money to fit expenses provides a systematic way

and utilizing income (Joseph Wilner, 2009). The more successfu managing our

finances, the better our lives will be either today or down in the line because it is the

special ingredient to making our money work for us.

Financial management behavior is considered one of the key concepts on the

financial discipline. Many definitions are given with regarding to this concept, for

example, Horne and Wachowicz (2002) propose financial management behavior as

the determination, acquisition, allocation, and utilization of financial resources,

usually with an overall goal in mind while Weston and Brigham (1981) describe

financial management behavior as an area of financial decision-making, harmonizing

individual motives and enterprise goals. Joo (2008) indicates that effective financial

management behavior should improve financial well-being positively and failure to

manage personal finances can lead to serious long term, negative social and

societal consequences. Thus, financial management is mainly concerned with the

effective funds management.

Financial literacy, financial knowledge and financial education are used

interchangeably in formal literature and popular media. Various sources provide

various definitions to financial literacy, but have one thing in common— everything

revolves around money, knowledge and use.

Mandell (2009) defines financial literacy as “the ability to use knowledge and skills to

manage one’s financial resources effectively for lifetime financial security.” Huston

(2010) explains that financial literacy is made up of two elements: understanding and

use. Understanding financial literacy implies that a person is knowledgeable about

personal finance, and applies such knowledge in dealing with one’s finances.

Statement of the Problem

This study aimed to determine how the respondents manage their own money

properly in CCNHS-Annex (L.R Sebastian Site).

Specifically, it aims to answer the following questions:

1. What is the profile of the respondents?

 2. How does a students knowledge in personal finace influence his/her

opinions and decisions?

3. What makes some ABM students relatively more knowledgeable than non-

ABM students?

Significance of the Study

The researcher has high hopes findings of this study will be used by and shall

benefit the different person included the educational process.

DedEd - The result of this study may help DepEd to determine how non-ABM

student manage their personal money.

Faculty - Faculty can reflect and see if the respondents are managing properly their

own money.

Teachers. The teachers wil gain knowledge about managing the personal finance so

that she/he will persue teaching related in Personal Financial Management in their

students.

Students. In this study, the result may directly benifit the students. It will encourage

the student to manage properly his/her own money.

Parents. The result will help the parents guide their children on handling their

personal finance as well as they can control and estimate how much money that will

give to thier children.

Future Researcher. The result of this study will personally benifit the researchers.

The researcher will made fully aware of managing their personal money.

Scope and Delimitations

This research will focuses on the Personal Financial Management in CCNHS-Annex

(L.R Sebastian Site). The respondents are the Grade 12 (HUMMS and GAS). The

information needed will be gathered and preserve for the final output.

Definition of Terms

For a better clarification of the terms we used in this study, the following terms are

defined conceptually:

Financial Management. A concept that explains how financial assets are managed.

It encompasses critical areas in finance like investment, budgeting, banking and

taxes. It is therefore a strategy used to ensure that investment assets yield the

highest interest value. Several academic works indicate that money management

skills play an essential role as it influences the spending habits of students on

campus.Students enter colleges without the basic knowledge of money management

whicharises from inadequate financial knowledge

Savings. Defined as the variation between net worth at the end of the period and the

net worth at the beginning of the period which should equal the excess of income

over consumption expenditure in the same period.Savings is therefore explained as

money or physical assets allocated for future use.

Financial Behavior. It can be defined as any human behavior that is relevant to

money management. Common financial behaviors include cash, credit and saving

behavior.

Money. Money is any item or verifiable record that is generally accepted as payment

for goods and services and repayment of debts, such as taxes, in a particular

country or socio-economic context.

Financial Literacy. Financial literacy is the possession of the set of skills and

knowledge that allows an individual to make informed and effective decisions with all

of their financial resources.

CHAPTER II

Review of Related Literature

This chapter presents the review of related literature and studies that give relevant

information helped the researcher in establishing the justification and additional insights to

the study under consideration.

Financial Management

Financial management is alarmingly affected by demographic characteristics such as age,

education level, gender, parents, peers etc. several academic works have been conducted

across countries to confirm it. Literature has shown that there is a direct correlation between a

person‟s age and his or her personal finance understanding. The personal finance

understanding of children and the youth tend to be low compared to the old age. The

acquisition of financial management therefore tends to increase with age and experience.

Hogarth and Hilgert (2010) reveals that students within the ages 18 –24 years are those that

are financially least knowledgeable whilst those within the ages 36 – 40 years are more likely

to budget their expenditure.Several empirical studies on financial management reveal that

there is financial literacy gap between women and men as men tend to be equipped with

knowledge, information, instruction and ability to apply ideas and concepts relating to

finance more than women. It has been generally established that females display much lower

knowledge and use of financial literacy than the males due to several reasons. Among the

reasons include the fact that women have limited access to capital compared to men and also
risk averse during investment decisions. From the literature, men tend to perform creditably

well in most personal finance quizzes compared to the women. This consequently urges men

to take more financial risk which puts them in higher debt accumulation in relation to women

(Davies and Lea, 2015). Men have the perception that having enough money will make them

well respected in the society. A person‟s education level has consistently found to have a

direct effect on personal finance. The level of education tends to have a positive relationship

with personal finance. However, there is a contraction as many university graduates have

proven to have inadequate personal finance (Van Rooiji, Lusardi and Alessie, 2009). This

implies that having the University education does not necessarily mean that one has high

financial autonomy. Individuals who are illiterate have proven not to appreciate the basic

financial concepts such as risk diversification (Lusardi and Mitchell 2011).Many scholars in

the field of personal finance have indicated that parents have essential impact on their

children consumption pattern as it has been shown in the literature that children tend to

develop their money management processes from parents (Pinto et al., 2016). Students then

learn from their parents how to manage their finance. This implies that parents are principal

agent on the consumer socialization of their children (Alhabeeb, 2014). Parents then

influence the way children handle money and instill the attitudes their children have towards

savings (Eikmeier, 20010) . According to Palmer et al. (2001) as acited by Armstrong(2014),

parents are able to pass their choice for goods and services to their kids as they learn the

consumption pattern of their parents through socialization. Children become consumers of

specific products as they grow older and thus reiterates the fact that parents are the principal

source of learning since they are the first point of learning for children.Another factor that

influences the behavior of children is the peer group influence although children are

influenced by the attitudes of their parents. Peer influence however becomes more significant

when they reach adolescence stage. The interaction with the peers exposes the youth to the
current trends of fashion and consequently affects the consumption and the buying pattern of

the youth. The impact of peer groups on children is however centered on the attitude of the

children as literature has shown that peer group influence impacts positively towards the

learning behavior of children in relation to money management (Hayta, 2009).

Financial Education

Bernheim, et al (2001) believe that although financial literacy is a somewhat new, policy

initiatives in financial literacy is not. In 1950s, the United States began recommending

policies to improve the quality of personal financial decision making through financial

education thru the “inclusion of personal finance, economics, and other consumer education

topics” to children enrolled in the K-12 educational curriculum.

Financial education should be the best tool to effectively come up with better financial

outcomes. Previous studies have shown that lower levels of financial literacy is associated

with lower rates for planning for retirement, lower rates of asset accumulation, using higher-

cost financials services, lower participation in the stock market, and higher levels of debt.

Financial Literacy

The Filipino mindset upon receipt of salaries, as commonly-known, is that upon receipt of

salaries, spending comes in before saving. What is left, is saved. If there’s none left, then,

there’s nothing saved.According to a study conducted by Philam Life, 96 percent of Filipinos

are concerned about their own and their family’s health, however, only 16 percent of them

are prepared to pay for medical costs in case they are diagnosed with a critical illness.There is

a rising number of senior-dependents or those retirees who depend on their children for

financial help, due to lack of financial education. a financial literacy measure may be used to

predict financial behaviors or outcomes, it does not necessarily imply that individuals will
behave in a way that many scholars, policymakers or educators would deem optimal. In

other words, the mere assumption that the presence of more information and skills will

lead to improved financial behavior is faulty, as stated by Other factors, such as

behavioral/cognitive biases, self-control problems, family, peer, economic, community and

institutional influences, can determine the nature of the individual decisions. Point out that

the individuals’ financial well-being is dependent on their actions, besides the external

influences of politic and economic forces. That is why it is increasingly recognized the

critical importance of understanding the relationship between knowledge and personal

financial issues. However, it is generally recognized that the level of financial knowledge

is, in fact, an important determinant of individuals’ financial behaviors, mostly the

subjective knowledge, measured by the self-assessed individual knowledge degree. The

lack of financial sophistication is a widely pointed reason for many financial mistakes

made by individuals

Financial Planning

Financial planning teaches individuals to be responsible when it comes to their finances, and

instills the discipline needed in order to keep track of their financial goals. Financial planning

involves educating Filipinos on the different types of goals that they should set: short-term,

medium-term, and long-term. Short-term goals involve monthly living expenses that need to

be paid, or the person’s basic needs, including the setting-up of an emergency fund. In

contrast, medium term goals are those you want to achieve in one to five years like buying a

house or a car, while long term goals are those that take longer than five years to achieve.To

address the growing demand for more investments in the country, the financial industry

advises that Filipinos should save first and spend whatever is left after putting their savings

aside.
Financial Behaviour

Financial Behaviour Several studies in the past have tried to investigate the impact of

financial literacy on financial behavior. Financial literacy has proved to facilitate

students involvement in savings and investment, freeing themselves from debt, effective

money management through living on a budget. Add to this argument stating lack of

financial knowledge has often leans to face financial difficulties in students lives. Suggest

that increasing financial literacy can be an effective strategy in improving quality of

lives of individuals because more knowledge on money leads to positive attitudes

towards quality of life which ultimately leads to better decision making resulting with

effective utilization of resources to improve their standard of living.

CHAPTER III

Methodology

This chapter presents the research design, locale of the study, respondents of the

study, sampling technique, research instrument, data gathering procedure and

statistical treatment of data.

Research Design

The study adopted the descriptive method that assessed the Personal

Financial Management in CCNHS-Annex (L.R Sebastian Site) in any aspects of life.

 The study utilized the descriptive method of research as the most appropriate

method in conducting the investigation. The method was deemed most appropriate

in the light of the objective nature and scope of the study.

Locale of the Study

This study will be conducted at the CCNHS - Annex (L.R Sebastian Site) located at

Lillia Parreñas Street RH XI Cotabato City.

Respondents of the Study

The respondents of the study will be the Grade 12 HUMSS AND GAS Students of

CCNHS-Annex(L.R SEBASTIAN SITE. This study involved a total of 24 HUMSS

Student and 6 GAS Students.

Sampling Technique

This study will use purposive sampling. Purposive sample is a non-probability

sample that is selected based on characteristic of a population and the objective of

the study. It is also known as judgmental, selective, or subjective sampling.

According to Fraenkel, et al (2012), a purposive sampling is different from

convenience sampling in that researcher do not simply study whoever is available

but rather use their judgement to select a sample that they believe, based on prior

information, will provide the data they need.

Research Instrument

Questionnaire – A prepared set of questions design to operate data necessary for

accomplishing the objectives of the research project. It will be the primary instrument of the
researcher to have the data.
The questionnaire consisted of the following: The General Profile of the respondents such as

name, gender, age, civil status. The second part is the infleunce of students knowldge to

his/her opinions and decisions. The third part is the advantage of ABM students over the

Non-ABM students.

Data Gathering Procedure

In order to gather the necessary data, the researcher consulted it in internet, read

articles, books and will also conduct survey questionnaire to gain more data and

proof. Researcher will personally distribute the questionnaire to the students who are

prioritized and included in this research. After the distribution is the validation of the

questionnaire. It its analysed and interpreted through the data gathered and

formulate the conclusions and recommendations of this study

Statistical Treatment of Data

In analysing the data gathered in this study, the researcher use a descriptive

analysis which the researcher will describe basic features of the data in a study. It

will provide simple summaries about sample and the measure.