Understanding the Relationship Between Financial Literacy and Spending Habits in University Students

Abstract

Younger generations in Malaysia are increasingly exhibiting reckless spending habits. They tend to spend without restriction, causing shifts in lifestyle and spending habits. As a result, it is extremely important to evaluate how well our country's children understand various financial practices and services especially students in university. Students should not only learn financial knowledge, but also apply it in their daily life. This study intends to investigate the relationship between financial literacy and spending habits among university students. The Statistical Package for Social Sciences (SPSS) version 26.0 was used to analyses the data. The strength and trend of the linear relationship between spending habits and financial literacy are measured by the Pearson correlation coefficient, or R. The results show that there is a positive relationship between UiTM students' habits of spending and financial literacy, implying that when students learn more about money, they are more likely to make good financial choices.