The Relationship between Financial Literacy, Lifestyle Choices, and Social Influence on Spending Behavior Among Students at Higher Learning Institutions Malaysia

Abstract

Abstract Spending behavior is a fundamental aspect of personal finance and profoundly influences individuals’ financial well-being and overall quality of life. Understanding the factors that underlie spending behavior is of paramount importance, particularly in the context of students who are often navigating financial independence for the first time. This paper attempts to investigate the relationship between financial literacy, lifestyle choices, and social influence on students' spending behavior in Malaysia's higher learning institutions. Survey questionnaires were distributed randomly to the higher learning institutions students in Universiti Teknologi MARA Malaysia and 205 returned feedback to be used for the data analysis purposes. The findings revealed that students in higher learning institutions' spending behavior is influenced by their financial literacy, lifestyle choices, and social influence. The results further explained that gender does not moderate the relationship between all variables and students’ spending behavior. Furthermore, this study underscores the intricate relationship between financial literacy, lifestyle choices, and social influence in shaping students spending behavior. Recognizing these factors and their interaction is essential for devising effective strategies to promote responsible financial decision-making among students, ultimately contributing to their financial overall well-being. Future research is encouraged to explore other factors in greater depth and develop targeted interventions for different student populations.