CHAPTER 1

Introduction

1.1 Background of the Study

Many students are having a hard time to budget their allowance. Allowance is given by
the parents/guardians to students, mostly to finance their wants and needs. Nowadays, students
spend more money from their allowances for school requirements, personal needs and for
everyday expenses. Allowance is money that is given to someone, usually on a regular basis, in
order to help them pay for the things that they need (Cobuild, 2018). The individual allowances
are used for its own purpose, therefore each individuals need to spend it wisely in order to save
money. As we all know, people are having hard time to save due to their increasing wants and
needs. Saving is the decision to defer consumption and to store this deferred consumption in
some form of asset (Kotlikoff, 1999). It may take time to be financial literate, but savings is
really important for students to be discipline enough to spend their money wisely.

There are certain questions that this study wants to look for the answer, the provoking
questions are: How much the student’s daily/weekly/monthly allowance/s? How much money do
they spend for your everyday? How much money they usually spend for your personal or school
necessities?

It is important to study this research because many Senior High School students need to
address their expenses; and make them realize the essence of saving, since most students
specially the Senior High School are not financially literate.

According to Barbara Coloroso “What is important for kids to learn is that no matter how
much money they have, earn, win or inherit, they need to know how to spend it, how to save it,
and how to give it to others in need. This is what handling money is about, and this is why we
give kids an allowance?”

The rate of savings of Grade 12 Senior High School students from their monthly
allowances refers to how much they can set aside money from the allowance given to them.
According to the published research, the incompetency exhibited by the Senior High School
students, therefore their ability to make sound financial decisions, thus the issue of personal
finance comes in the topic which will affect the rate of savings on how the students manage or
budget their monthly allowances from their expenses in school.
1.2 Statement of the problem

As a students, they should know how to manage and spend wisely. Since students are still
sustained by their parents, it does not mean that they will depend always on their parents. Even
though they are still students, they can earn and save money at the young age. But, most students
from Ateneo de Zamboanga University Senior High School are lacked of knowledge about
financial literate. They still did not know the essence of savings and as a result, they just spend
their money as long as they wanted. Therefore, this study would like to find out on what are the
expenses of the students as soon as their allowances is received monthly, since it is a monthly
basis allowances.

1.3 Significance of the Study

1.3.1 Benefits of the Study to the Society

Through our research, the Zamboanga community will be able to know the importance of
saving and budgeting money in some circumstances. Furthermore, they will be able to know the
disadvantages of saving and budgeting money, which it also helps the people involved in the
city. Just like the government, they should budget the money for the projects implemented and
having funds or capital for the city. The disadvantage is, if they do not know how to budget and
save money, eventually they will struggle financially and it will mean that there will be
insufficient funds available to finance investment in physical infrastructure such as roads,
bridges, airports etc. and social infrastructure such as schools, hospitals etc.

1.3.2 Benefit of the Study to the Institution

The Ateneo de Zamboanga University will benefit this study in order for the institution to
give students the ideas and enough knowledge regarding on saving and budgeting their money or
specifically their monthly allowances. Since, it was said that, projects, handouts or any
contributions of the students are some of the reason why students meet their expenses. Thus, this
study will also give the institution of other ideas on how they will look for solutions or other
alternatives to help students minimize their costs regarding on the said reasons.

1.3.3 Benefit of the Study to the Respondents/ or Students

This study will benefit the students by giving them further knowledge and absorption
which can help them to become a financially literate to help them on a daily basis, emergencies
or especially in the future. This study will help them realize how to control their expenses to their
prioritized things versus unprioritized one and especially how crucial saving or budgeting money
is.

1.3.4 Benefit of the Study to the Researchers

As the researchers and other researchers who wants to study this research
comprehensively, aside from the idea of what is the importance of saving and budgeting money
from allowances, through this study it will satisfy us regarding on getting a points or perception
from the different respondents on why they spend this said reasons of their expenses. In which it
would also help us to be aware and how we are going to be responsible on our financial
decisions.

1.4 Definition of terms

The independent variable is the monthly allowance because does not change the fact that
students are given their monthly allowance, while on the other hand, the dependent variable is
the students’ savings because they don’t have constant amount of savings. It depends on them if
they even save or how much will they save.
 CHAPTER 2

Review of Related Literature

2.1 Introduction

This chapter does a review of related literature from books, portable document format
(PDF) and internet on savings and expenses of Senior High School students. Furthermore, this
chapter is structured as thematic literature review because we group and discuss our sources by
terms of the themes.

2.2 Savings

Saving is not the absence of spending. Instead, saving is the intentional act of setting
money aside for a specific goal or purpose (Pant,2018). Savings is important because if ever
some unexpected situations may occur, it could lessen any expenses. As a students, though they
are still financially supported by parents it does not mean that students cannot save money. Even
at young age, they can start save money even just a small amount. Because savings can help
students to be financial literate and know the value of money. It could help them also to use their
money that are being save for some goals like for outing. For students, it is bigger advantages for
them because they are still financially supported by their parents as a result, they can save bigger
amount or rather they can save right now from their allowances.

2.3 Problems/reasons about Savings

Spending more than earning is not a smart personal finance. Earning more than you
spend and invest the difference wisely (Megas, 2016). Earning means that you are able to bring
in money, while spending means that you are able to be thrifty and spend wisely. Sometimes
people always spend without thinking of how much they are losing their wealth, as well as with
students. They are unaware of the amount they are spending, though spending is not a bad thing,
they should have a discipline on how they spend money and where they spend it. As much as
possible we should start saving to be financially secure in case of emergency.

As we all know, we are dealing with inflation and due to this problem students are having
hard time to save money. Inflation is a rise in the general level of prices. The main cause of
inflation is an increase in demand without a comparable increase in supply Kapoor, Dlabay &
Hughes (1999). The prices of goods and services increases so with the wants of students. This is
one of the reasons why students cannot save money, of course we still need to sustain our needs
first, before anything else. After they been satisfied for their needs, students will look for their
wants. Since the wants of people are increasing so with the prices of goods and services
therefore, it could really lead to shortage of money.

Clothing is one of the most varied personal-consumption items that must be purchased.
Because of this problem, it is very easy to overspend your budget and still end up with an
unsatisfactory wardrobe (Hurley,1976). As a result, people are getting hard time to save money.
For students, they also deal with several financial problems due to school requirements, tuition
fees and daily needs such as food for lunch and for the transportation. Sometimes, people keep
on spending money because they have to spend it for their personal needs. However, in spending
money, people should be practical and disciplined because we do not know what might be
happen. We can use our savings if ever some unexpected situations may occur anytime.

Family Economics and Financial Education (2010) have pointed that because a person
does not know what will happen in the future, money should be saved to pay for unexpected
events or emergencies. An individual car may breakdown, their dishwasher could begin to leak,
or a medical emergency could occur. Without savings, unexpected events can become large
financial burdens. Theses such situations might occur unexpectedly therefore, people should
learn how to budget and save their money so that they can use it for any situations. Furthermore,
students can save money because they are still financially supported by their parents. Being
financially literate and through knowing its limits, priority more important things is a good start
of saving money.

Stollak, Vandenberg, Steiner & Richards have also pointed that females were found to be
more likely than males to create a monthly budget. Females tend to create a or plan a monthly
budget. According to psychology, women are more organized than men. It is stated in the quote
that females are more organized in making plans for a monthly budget. Thus, it proves they
females are more budget minded than men. This shows us that women are more capable in
financial management.

2.3 Ways on Saving money

One of the steps of saving was stated by the U.S Securities and Exchange Commission as
the next step is to keep track of your income and your expenses for every month. Write down
what you and others in your family earn, and then your monthly expenses. As a students, you
might think that saving and investing is something you don’t need to consider right now. But,
there is a cost waiting, and even saving a little now can add up over time and help you pay for
your short and long-term goals. One of the biggest challenges of students nowadays is to spend
less money, even though all the expenses is increasing. Some students ate still greedy and still
having an appropriate time to go to the mall and buy some stuffs they want to have.
 It is necessary for students to have a plan or steps on how to save money. It is very
important to be guided on spending and budgeting to arrive in saving money. Berngrover,
Johnson & Mulgren (1981) stated that to fill out such a budget with your own financial
information, it becomes necessary to collect some data. Second, determine other expenses and
divide them into two categories; fixed and flexible. And lastly, timing of these expense. These
process could somehow help students on budgeting their allowance. It is really necessary if a
students will take down notes of their expenses every day in order to determine their costs each
day. After taking down notes, cross out the expenses that you think you do not usually need and
just for your wants. We need to set a boundaries between needs and wants. It is fine to spend
money for wants, as long as each students must set in mind the word budget and save.

There are many subtle but effective methods for saving money when shopping food
(Martin, Petty & Klock,1982) . It is stated that according to the study, it is better to shop after
eating because you are to spend less money. Food is one of the most common problem on
budgeting, but there some ways on how to spend less when it comes to food. Example for
students, it is advisable and wise to look and pack own meals at home in order to avoid spending
at school. However, some students, does not bring packed meals from home for some reason.
There are still ways to purchase food thriftily by looking for foods. That is safe and affordable.
Especially, we should ensure that the food we buy is just exclusive for one meal.

Managing money is one of the challenges that a student may face, it is the process of
budgeting, saving and investing money. As stated by the Health Care Family Credit Union
(2018) the first step in helping a teen learn to manage money is getting them their own account.
Second step is understanding how to budget. And third, put your plan into action. Getting your
own account is having the responsibility of taking care of your money. Getting a teenager their
own account will help them in budgeting their money. They will be the one who will be
responsible for setting their budget, which is good because this will help them to manage their
own finances. Understanding on how to budget their money will also help them to be able to
save money. But this will not be possible without action, so to make this all possible they need to
do it and work for it.

2.4 Importance of Savings

Being financially literate is applicable for Senior High School students, it is of knowing
on how to save and budget your money. It is also one of the best way to save for the future, but
most of the Senior High School students do not know how to save money. The key to financial
success is being aware of how you’re spending your money (Moukendi,2014). Financially
success means that you are able to control your money, instead of your money controlling you.
Most of the Senior High School students loves spending their money for foods, clothes, and
other necessities that they will probably like even if they do not need it. This is the reason why
they cannot save even a single peso from their allowance. It is really important for students of
their age to have enough knowledge about saving, they should be aware of how to spend their
money and on how to budget it.

Parents can encourage their children to make careful spending decisions and plan the rest
of their money (Wong,2013). Parents have the authority over their children. Naturally, children
look up and listen to their parents. And because of this, it is better that parents discipline their
children in terms of handling money. A parent should be the first one to advice her child to save
and the first one to start planning on what should be done with the money. It is good that a child
can see how wisely his parents spend money and see the essential of saving through them. If he
realizes these things are important in his life, he will eventually learn how to save and it will
never be a struggle in the future.

Wong (2013) also suggested from other chapter that curriculum at schools should
introduce the Financial management courses for students to expose them with the world of
money management. This could help to guide and encourage students to solve at the young age.
It states that the schools should not only focus on academics but also should teach students of the
outside world, and one of them is to become financial literate. It is important for students for a
reason that they tend to be big spenders, and that alone is not a good personality. It is a necessity
to learn financial management so that it could guide them in saving for the future purposes. If
they put what they have learned to practice, they will slowly realize that they are saving
themselves from a big possibility of a haphazard. Financial management is a thing that would
really help young students in attaining financial security. It will help them understand the
concept of saving and why saving is important. The practice of financial management will help
the students in saving because the after practicing financial management the students will get
used to saving, and saving will lead them to have a good stable life until the future.

Saving money for the future gives you protection for unexpected circumstances (Green,
2015). Every day we woke up not knowing on what life will bring us, there are a lot of
unexpected things that may come. As to what they always say, prevention is better than cure.
Saving money is very important because it secure us financially in case of emergencies.
Whenever emergencies occurs, you will not stress out because you have money to spend of. This
is one of the reasons why being financially literate is very important for each and every students.

Know your one’ self is important in order to determine how you will manage your budget
and expenses in terms of your needs and wants. Bailard, Biehil & Kaiser (1986) stated that this
self-knowledge is very important. It can enable you to choose financial alternatives that are real
value to you and to avoid buying illusions, perhaps of romances or excitement. Somehow, this
phrase reflects the people especially students. Students would just buy a certain products because
it is cute, beautiful, etc. We should know our self, we should know which goods and services
will make us better and satisfy our needs, not just for some stuffs only. Once the students have
the knowledge about themselves they can determine already which expenses they should
purchase and which is not. In this way, the students can gain knowledge of being financial
literate and be practical in terms of spending money from their allowance.
 CHAPTER 3

Methodology

3.1 Research Design Variables, Pilot Study, Approach

Our Independent Variable is the monthly allowance while, the Dependent Variable is the
students savings. Monthly allowance is our independent variable because it is constant, while
savings is our dependent variable because it depends on the monthly allowance of the Grade 12
Senior High School students. The types of quantitative research that we have is descriptive
because is seek to describe the current status of the variables. In additional, we will conduct a
pilot study in order to value the questions and evoke the right information to have relevant results
that can answer our research questions.

3.2 Sampling method, Sampling Plan and Sampling Technique

In our research study, we will be using probability sampling because it is a Quantitative

3.3 Setting

Our research study will be conducted at the Ateneo de Zamboanga University located at
the La Purisima St, Zamboanga, 7000 Zamboanga del Sur. Nearby, Cathedral church and in front
of the MP tower building. Ateneo de Zamboanga University is founded by the Jesuit Society and
still acknowledge and celebrate the feast of the Jesuits especially St. Ignatius De Loyola.
Furthermore, Ateneo de Zamboanga University also educate student’s magis which means to do
more or to strive more for better. And for proper disposal, the Ateneo de Zamboanga University
educate students the CLAYGO which means Clean As You Go. And lastly, Ateneo de
Zamboanga University educate students to be cura personalis which means to care, love and help
each other.

3.4 Participants

The participants in our research study are students from the Ateneo de Zamboanga
University Senior High School Grade 12 particularly, Accountancy, Business and Management
(ABM) Strand. From the target population, we will get 10 participants from each sections as our
sample.
3.5 Instruments, Survey and Letters

In order for us to come up a relevant information’s, first we have to do a letter that will be
address to the Ateneo de Zamboanga University Senior High School Principal and another letter
address to the respondents. We should first, ask permission to inform the Senior High School
Principal that we will conduct a survey. Second for the respondents we should ask permission if
they are willing to participate in our study because under the basic human rights, the right to self-
determination (autonomy) which means they have the right to volunteer or decline to participate.
Lastly, if it is approved, we will already do the survey questioners.
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