Submit your papersSubmit Now
For Enquiries: [email protected]
IIARD LogoIIARD

Financial Literacy and Investment Decisions of Public University Students in Bayelsa State: The Role of Debt Management and Savings Literacy

Festus Emeke OGWU, and Confidence Joel IHENYEN PhD

Abstract

The study investigated the relationship between financial literacy and investment decisions of students in Bayelsa State, focusing on trainee accountants from three universities: Niger Delta University (NDU), Federal University Otuoke (FUO), and University of Africa (UAT). Specifically, it examined the relationship between debt management, savings literacy, and investment decisions. A cross-sectional survey design was employed, with a population of 1,473 trainee accountants. A sample of 315 students was determined using Taro Yamane’s formula, and Bowley’s statistics was used to determine the proportional representation of each institution. A simple random sampling technique was employed to select respondents. Data were collected through structured questionnaires and analyzed with the aid of SPSS version 23. Descriptive statistics and Spearman’s rank correlation coefficient explored the relationships between financial literacy dimensions and investment decisions. The findings revealed positive and significant relationships between financial literacy dimensions: debt management and savings literacy, and investment decisions. The study concludes that there is a positive and significant relationship between financial literacy and investment decisions of student in Bayelsa State. Based on the findings, the study recommends that educational institutions organize workshops and courses on debt management, covering topics like interest rates and repayment strategies, and incorporate savings literacy into the curriculum through practical lessons on building emergency funds, understanding saving techniques, and financial planning to enhance students' investment decision-making skills.

Keywords

Financial LiteracyDebt ManagementSavings LiteracyInvestment Decisions

References

Abakah-Yawson, D. P. (2018). Financial literacy of small business owners, financial records keeping and enterprise performance in the Tarkwa-Nsuaem municipality (Doctoral dissertation, University of Cape Coast). Abdeldayem, M. M. (2016). Is there a relationship between financial literacy and investment decisions in the kingdom of Bahrain? 5(4), 203-221. Acharya, D. S., Bhat, P. S., & Sumalatha, P. J. (2023). A study on financial literacy and investment behaviour of teachers. Journal of Survey in Fisheries Sciences, 10(1S), 5096-5106. Ahmed, A., & Fayyaz, A. (2021). Debt stress, financial coping, and psychological well-being among university students. Journal of Financial Counseling and Planning, 32(1), 151- Albarrán, I., & Attanasio, O. (2020). The effects of credit and debit literacy on borrowing behavior and debt accumulation: Evidence from a randomized controlled trial in Chile. American Economic Journal: Applied Economics, 12(2), 38-65. Ameliawati, M., & Setiyani, R. (2018). The influence of financial attitude, financial socialization, and financial experience to financial management behavior with financial literacy as the mediation variable. KnE Social Sciences, 3(10), 811– https://doi.org/10.18502/kss.v3i10.3174 Ammerman, D. A., & Stueve, C. (2019). Childhood financial socialization and debt-related financial well-being indicators in adulthood. Journal of Financial Counseling and Planning, 30(2), 213–230. https://doi.org/10.1891/1052-3073.30.2.213 Anand, A., Irvine, P. J., & Puckett, A. (2020). The cost of financial advice: Evidence from mutual funds. Journal of Finance, 75(4), 1949-1980. Appiah, J. (2019). Financial literacy and saving behaviour among Teaching and Non- Teaching Staff of Swedru School of Business (Doctoral dissertation, University of Cape Coast). Arthur, H. B. (2019). Financial literacy, financial behaviour and savings behaviour among owner-managers of small and Medium-scale enterprises in Awutu Senya East District (Doctoral dissertation, University of Cape Coast). Balagobei, S., & Prashanthan, V. (2021). Impact of financial literacy on investment decisions: evidence from individual investors in Jaffna district. International Journal of Accounting and Business Finance, 7. Bayer, A., Kuhn, A., & Schulte, M. (2020). The dynamics of child development: Analyzing socio-economic status and maternal education. Journal of Applied Econometrics, 35(1), 101-120. Borgloh, S., & Dannenberg, A. (2021). Do socio-economic factors influence financial literacy? Evidence from Germany. Journal of Consumer Policy, 44(2), 339-364. Brigham, E. F., & Ehrhardt, M. C. (2017). Financial management: Theory & practice (15th ed.). Cengage Learning. Cameron, M. P., Calderwood, R., Cox, A., Lim, S., & Yamaoka, M. (2014). Factors associated with financial literacy among high school students in New Zealand. International Review of Economics Education, 16, 12-21. Chepngetich, P. (2016). Effect of financial literacy and performance SMEs. Evidence from Kenya. Evidence from Kenya. Cole, B. (2018). Financial education in the classroom. Education Digest, 84(7), 26-32. Council for Economic Education. (2020). National Standards for Financial Literacy. Retrieved from https://www.councilforeconed.org/national-standards-for-financial-literacy/. Dabira, E. (2018). The impact of tuition fees on students' choice of university: A case study of Nigerian students. International Journal of Educational Research, 4(3), 11-22. Edeh, C. (2023). Global money week: Financial literacy activities in Nigerian schools. Journal of Economic Education, 7(2), 120-134. European Commission. (2020). A capital markets union for people and businesses-new action plan (COM/2020/590 final). https://eur- lex.europa.eu/resource.html?uri=cellar:61042990fe46-11ea- b44f01aa75ed71a1.0001.02/DOC_1&format=PDF. Fernandes, D., Lynch Jr, J. G., & Netemeyer, R. G. (2014). Financial literacy, financial education, and downstream financial behaviors. Management Science, 60(8), 1861- Gitman, L. J., & Zutter, C. J. (2019). Principles of managerial finance (15th ed.). Pearson. Hamza, N., & Arif, I. (2019). Impact of financial literacy on investment decisions: The mediating effect of big-five personality traits model. Market Forces, 14(1), 43-60. Handini, S. (2024). The impact of financial literacy, investment knowledge, and investment motivation on investment decisions. West Science Journal Economic and Entrepreneurship, 2(01), 46–62. https://doi.org/10.58812/wsjee.v2i01.553 Hastings, J. S., & Mitchell, O. S. (2011). How financial literacy and impatience shape retirement wealth and investment behaviors. National Bureau of Economic Research Working Paper Series, No. 16740. Hilgert, M. A., Hogarth, J. M., & Beverly, S. G. (2003). Household financial management: The connection between knowledge and behavior. Federal Reserve Bulletin, 89(7), 309- Hira, T. K. (2015). Promoting sustainable financial behaviour: Implications for education and research. International Journal of Consumer Studies, 36(5), 502-507. Hira, T. K., & Mugenda, O. M. (2019). Financial education in schools: Promoting financial literacy among high school students. Journal of Financial Counseling and Planning, 30(2), 257-269. https://www.vanguardngr.com/2023/03/ponzi-scheme-has-caused-my-two-sons-mental- problems-distraught-mother-laments/ Ibanga, F. (2021). The Dangers of Trading Cryptocurrencies. This Day Live. Retrieved from https://www.thisdaylive.com/index.php/2021/06/05/the-dangers-of-trading- cryptocurrencies/ Janor, H., Yakob, R., Hashim, N. A., Zanariah, Z., & Wel, C. A. C. (2016). Financial literacy and investment decisions in Malaysia and United Kingdom: A comparative analysis. Geografia, 12(2). Jemal, L. (2019). Effect of financial literacy on financial performance of medium scale enterprise; case study in Hawassa City, Ethiopia. International Journal of Research in Business Studies and Management, 6(11), 33-39. Khusaini, K., Mardisentosa, B., Bastian, A. F., Taufik, R., & Widiawati, W. (2022). The impact of financial education and socioeconomic status on the undergraduate students' financial literacy. Media Ekonomi Dan Manajemen, 37(1), 55-76. Kozina, F. L., & Ponikvar, N. (2015). Financial literacy of first-year university students: The role of education. International Journal of Management, Knowledge and Learning, 4(2), 241-255. Lim, Y., & Pyun, H. (2020). Financial literacy and financial planning in South Korea. International Journal of Consumer Studies, 44(1), 34-45. Lusardi, A. (2019). Debt literacy, financial experiences, and overindebtedness. Journal of Pension Economics & Finance, 18(1), 1-26. Lusardi, A. (2019). Financial literacy and the need for financial education: evidence and implications. Swiss Journal of Economics and Statistics, 155(1), 1-8. Lusardi, A., & Mitchell, O. S. (2011). Financial literacy around the world: an overview. Journal of Pension Economics & Finance, 10(4), 497-508. Lusardi, A., & Mitchell, O. S. (2014). The economic importance of financial literacy: Theory and evidence. Journal of Economic Literature, 52(1), 5-44. Lusardi, A., & Tufano, P. (2015). Debt literacy, financial experiences, and overindebtedness. Journal of Pension Economics & Finance, 14(4), 332-368. Madura, J., & Fox, R. J. (2011). International financial management (11th ed.). Cengage Learning. Muneeb, A., & Atal, R. (2019). Assessing the influence of financial literacy on profitability: Evidence from Nangarhar-Afghanistan. International Journal of Technical Research & Science, 4(11), 16-23. Organisation for Economic Co-operation and Development (OECD). (2013). Program for international student assessment 2012 results. Excellence through equity: Giving every student the chance to succeed (Volume II). Paris, France: OECD Pu

More Articles from JOURNAL OF ACCOUNTING AND FINANCIAL MANAGEMENT

Cashflow Management and the Performance of Commercial Banks in Nigeria

Author: Jeffrey Ayas Iyakonbogha, Clement E. Ozele

The Nigerian Code of Corporate Governance and Financial Performance of Deposit Money Banks in Nigeria

Author: i, Eneaniofu Daniel Mmaduakonam, ii, Azolike Nkiru Nkechi, iii, Emeter Patrick Okechukwu, iv, Okwor Emmanuel Ejimnkonye