The Influence of Spending Behaviour Among University Students in Malaysia

Abstract

The number of insolvencies in Malaysia is rising rapidly, especially among the youth. According to the Malaysian Insolvency Authority, the number of bankruptcy declarations has been steadily increasing since 2015. Indebtedness and overspending are the main causes of this condition, and they could be caused by a lack of financial capability. This study focuses on university students because they are the future stars of the country. The objective of this study is to investigate what factors influence the spending behaviour of university students in Malaysia. The study uses primary data collected through structured questionnaires from a sample of 300 university students in Malaysia. The data were analysed using Statistical Package of Social Science (SPSS) 28.0 software and descriptive survey method. In this study, three independent variables are used to determine the relationship between spending behaviour of university students in Malaysia: Financial Management Knowledge (KFM), Parental Income (PI), and Peer Influence (P). Descriptive statistics, normality test, correlation and regression analysis were used to analyse the data. The results show that, with the exception of financial management knowledge, all independent factors have a significant relationship with university students' spending behaviour. This study also offers suggestions and critiques on how to address the problem of excessive spending among university students, especially Malaysian students. Therefore, the focus of this study is to discuss these characteristics and the spending behaviour of university students.