Consumer centric antecedents to personal financial planning

Abstract

PurposePersonal finance influences everything we buy and is a key driver of all economies. It has attracted significant research attention, mostly grounded in rational economics. However, it has not received adequate research attention in the consumer behavior literature. This study aims to address this gap by looking at some of the consumer-centric antecedents of short- and long-term personal financial planning, i.e. self-other orientation, cognitive style and time orientation.Design/methodology/approachA self-administered survey was used to collect data from full time employees. Hypotheses were tested using multiple regression analyses.FindingsBoth short- and long-term financial planning are positively associated with non-impulsive and analytical decision-making styles; whereas self and other orientation are only associated with short-term financial planning. Intuitive decision-making is not associated to either short- or long-term financial planning.Research limitations/implicationsWhile analytical and long-term orientation are still important for personal finance, in the short run, consumers are also driven by self and other orientation.Practical implicationsThe results are relevant for both products and services that have long-term and short-term financial implications for consumers.Originality/valueThis study explores financial planning decision-making from a consumer behavior perspective, and addresses a gap in consumer behavior literature.