1. DETERMINANTS OF FINANCIAL RESPONSIBILITY:
A STUDY OF UNIVERSITY STUDENTS
*Olivia Hazel, Dr. Ali Ahmadi (Mentor), Department of Business--Marketing
Overview
Hypotheses
References
Responsibility -vs- Literacy
Acknowledgements
Financial Responsibility
The ability to make sound financial decisions
to capture the best interest of an individual.
Acquired through: living within means, budgeting, saving
more than spending, paying bills on time, & etcetera (readyratios.com)
Financial Literacy
Using knowledge on the topic of money management to
make smart financial decisions.
Acquired through educated understanding of: basic money
management concepts, investments, credit, etcetera (Hogarth, 2002)
Data Set & Research MethodsResults: ANOVA
Abraham, A., & Marcolin, S. (2006). Financial literacy research: current literature and future
opportunities. Australia: University of Wollongong Research Online.
Beal, D. J., & Delpachitra, S. B. (2003). Financial literacy among Australian university
students. Economic Papers, 22(1), 15.
Fay, B. (n.d.). Understanding the Dangers and Benefits of Credit Cards. Retrieved from
CollegeXpress: http://www.collegexpress.com/articles-and-advice/student-
life/articles/living-campus/understanding-dangers-and-benefits-credit-cards/
Hogarth, J. (2002). Financial literacy and Family and Consumer Sciences. Journal of Family
and Consumer Sciences, 94, 14-28.
Letkeiwicz, J., & Fox, J. (2014). Conscientiousness, Financial Literacy, and Asset
Accumulation of Young Adults. Journal of Consumer Affairs, p274-300.
Norvilitis, J. M., Merwin, M. M., Osberg, T. M., Roehling, P. V., Young, P., & Kamas, M. M.
(2006). Personality factors, money attitudes, financial knowledge and credit card debt
in college students. Journal of Applied Social Psychology, 36, 1395-1413.
Robb, Cliff A. and Deanna L. Sharpe. 2009. "Effect of Personal Financial Knowledge on
College Students' Credit Card Behavior." Journal of Financial Counseling & Planning
20 (1): 2543.
Robb, Cliff A. and Mary B. Pinto. 2010. "College Students and Credit Card Use: An Analysis
of Financially At-Risk Students." College Student Journal 44 (4): 823-835.
Sallie Mae, How undergraduate students use credit cards: Sallie Mae's national
study of usage rates and trends, 2009
Background Info on Students
• Deregulation of financial markets and easier access to
credit cards increases importance of financial
responsibility (Beal & Delpachitra, 2003; Abraham & Marcolin, 2006).
• College students are highly susceptible to low financial
responsibility levels due to:
• Weak economy, student loans, first-time independence,
easier credit card access, & “high-time preference”
(Letkeiwicz & Fox, 2014)
• Actions at this stage affect the future of both the
students and the economy
• Purpose: isolate factors that may affect the financial
responsibility (FR) level of college students
A survey was given to 55 students at Morehead State
University via in-person contact and online through
Surveymonkey.com. After analyzed, Quantitative research
was performed through a One-Way ANOVA, Regression,
and Correlation Analysis.
I would like to thank Morehead State University for
creating the Undergraduate Fellowship Program. It has
allowed me to use my in-class knowledge to conduct true
research and will assist me in my future. Morehead State,
the program, and the celebration of student scholarship has
made this all possible through funding and support. A
special thank you is given to Dr. Ali Ahmadi, my mentor,
for choosing me and for all the assistance.
Recommendation & Conclusion
H1: Gender plays a role in level of FR
H1a: Females exhibit lower levels
H2: College level plays a role in level of FR
H2a: Seniors exhibit lower levels
H3: Number of credit cards is inversely related to level of
FR
H4: Employment plays a role in level of FR
H4a: A longer period of employment leads to higher levels
86%
Own a credit card
(Fay)
50%
Own four or more credit cards by graduation
(Fay)
$4,100
Average credit card debt
(Mae, 2009)
9.4%-32%
Pay credit card bills in full each month
(Norvilitis et al, 2006; Robb and Sharpe,2009)
13%
Use credit cards frequently
(Robb and Sharpe, 2009)
Females
More financially at risk
(Robb and Sharpe, 2009; Robb and Pinto, 2010)
45%
Work full-time
(National Center for Education Statistics)
Upper-Classmen
More financially at risk
(Robb and Sharpe, 2009)
0.813
0.849
0.473
0.169
0.4
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Gender College Level # of Credit Cards Job Time Worked
Significance
Determination
• All independent variables were found to be insignificant (p-value >0.05)
• All hypotheses have been rejected, meaning:
• Gender does not play a role
• College standing does not play a role
• Number of held credit cards does not play a role
• Having a job does not play a role, and
• Time worked does not play a role
Actual
Responsibility
# of Credit
Cards
Job
Time
Worked
Level of
College
Gender
Actual
Responsibility
1.000
# of Credit
Cards
-.220 1.000
Job -.143 .174 1.000
Time Worked .086 -.005 -.679 1.000
Level of College -.088 .243 .018 .016 1.000
Gender -.033 -.007 .037 .078 -.166 1.000
All are very weak, however the direction of correlations were
all as hypothesized (signs of correlations were all as expected).
Financial Responsibility
Decreases when:
• # of credit cards increases
• Individual is a Female
• Individual progresses through college
Increases when:
• Individual has a job
• Time worked increases
Results: Correlations
REGRESSION
R R Square Adjusted R Square Std. Error of the Estimate
.251 .063 -.033 .66146
• Selected independent variables only accounted for a
6.3% change in the dependent variable
• Meaning, 93.7% of financial responsibility
levels are caused by other factors
• Majors should be accounted for
• Larger data set should be used
• Financial responsibility needs to be researched
• Family financial conditions may be a substantial
contributor to overall FR levels
Topic needs to be addressed further to prevent future,
negative economic and individual problems