The Impacts of Future Orientation and Financial Literacy on Personal Financial Management Practices among Generation Y in Malaysia: The Moderating Role of Gender

Abstract

This paper investigated the relationship between future orientation and financial literacy toward personal financial management practices among Generation Y in Malaysia, particularly amongst those who were born between 1981 and 2001 coming from Sabah, Sarawak, Selangor, Kuala Lumpur, Johor, and Penang. A total of 146 valid questionnaires were used for the analysis carried out in this paper. Data was analyzed using the Structural Equation Modelling (SEM) technique using Partial Least Squares (PLS). The outcomes displayed that future orientation and financial literacy have significantly positive effect on personal financial management practices. Nonetheless, gender does not have a moderating role between financial literacy and future orientation on personal financial management practices among Generation Y in Malaysia. The study’s outputs may serve as guidelines by the Malaysian government agencies and policy makers, apart from extending the body of knowledge to shed some light on personal financial management practices. The findings of the study also offer an alternative approach in addressing the escalating bankruptcy issues faced by Generation Y in Malaysia.