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Sor Dorotea Rubio Street, Bogo City, 6010, Cebu, Philippines
Contact Numbers: (032) 434-7160, (032) 260-1365 or 0967-012-7261
Member: Daughters of Charity – St. Louise de Marillac Educational System (DC- SLMES)

A SURVEY ON FINANCIAL LITERACY AMONG YOUNG

PROFESSIONALS OF BOGO CITY

CHAPTER I
INTRODUCTION

This chapter presents the introduction of the research study and its problem. It includes the
dependent and independent variables that are used in the study as well as the significance and
limitations.
A. Background of the study

Financial literacy is the confident understanding of concepts including saving,

investing, and debt that leads to an overall sense of financial well-being and self-
trust. It starts by building basic knowledge of money matters, debt management,
investment risk, saving options, and other financial topics (Mandell, 2014). Financial
literacy is important because it helps people manage money with more confidence
but also have a better chance of handling the inevitable ups and downs of their
financial lives by understanding how to prevent and manage issues as they arise.
This means that people can keep an eye on their bank credit card accounts so they
are aware of potential fraud as soon as possible, or being able to recover from an
financial emergency (Tang, 2013). Being a person who is financially literate, he or she
can establish a feeling of control over his or her finances while also using money as a
tool to freely make choices that build greater life satisfaction. A person can also
understand how to allocate his or her income towards various goals especially
financially (McGurran, 2021).

According to CFI Company, as a young professional, he or she should be

financially literate since issues on budgeting usually builds up during the time when
he or she is already able to generate income and manage his or her own expenses.
Young professionals as defined by teachers, nurses, accountants, business
professionals, and policemen who ranges at the age of 20 years old to 35 years old
who have worked for 1 year to 16 years. He or she should understand the financial
components and skills such as budgeting, investing, borrowing, taxation, and
personal financial management (Rodriguez, 2016). Being financially literate as a
young professional will give him or her the ability to make better financial decisions,
effective management of money and debt, greater equipped to reach financial goals,
reduction of expenses through better regulation, less financial stress and anxiety,
increase in ethical decision-making when selecting insurance, loans, investments,
and using a credit card, and effective creation of a structured budget. With the
proper discipline, exposure to financial concepts, and money management, financial
literacy will be a successful one (Anderson, 2013).

These young professionals are having to make major decisions for the first time in
their lives. One problem is that these young adults in this transition stage who lack
financial knowledge are inexperienced in financial markets, savings, and investing,
are at risk of making poor financial decisions that can have costly and lasting effects
(Lusardi, Mithell, and Curto, 2010). They do not know how to save their money and
where they would use it. Some are not sure where to invest, and some doesn’t have
enough salary for savings and investments.

This research is conducted in order to find out the financial literacy among young
professionals of Bogo City. This is also conducted to know how financially literate are
these young professionals in terms of savings and investments.
 B. Statement of the Problem

This study aims to determine the financial literacy among young professionals of
Bogo City.

Specifically, it aims to answer the following:

1. What is the demographic profile of the respondents relative to their profession?
2. How do young professionals manage their financial income?
3. How financially literate are the young professionals of Bogo City in terms of: a.

Investment
b. Savings

C. Research Objectives

This study aims to determine the following:

a. The demographic profile of the young professionals in relation to their work

b. The ways of managing the financial income of the young professionals

c. The financial literacy of the young professionals specific to investing and saving

D. Significance of the Study

The study is deemed important specifically to the following:

 Young professionals. They are the subject of the study. They are examined by the
researchers on how they manage their money and how they benefit from it.

Researchers. This will benefit the researchers for the information that they
acquire may be used for future purposes or studies that involve literacy on
financial aspects, and would make them knowledgeable when the topic is
brought up in future research.

E. Scope and Delimitation

This study focuses on the financial literacy among young professionals of Bogo
City. The conclusions which shall be drawn from the study are based on the
responses given by young professionals of the city. Young professionals of Bogo city
are choses as the center of the study because they are the one who are mostly in the
peak of budgeting and managing their finances since they are already earning their
money. Teachers, nurses, accountants, business professionals, and policemen were
the chosen professions since these are the most common and high in number in the
locale of the study. The researchers focused on savings and investing because these
two are the general terms and the most useful as a financial literate person. Savings
and investments are important when a person is working and earning money. This
study will be helpful to the students in learning the significance of saving and
managing finances.

This study analyzes the financial literacy among young professionals of

Bogo City. The researcher faced time constraints since this is an academic paper and
needed to be completed according to the academic almanac of the school; hence it
was a short period of time to complete the study. To minimize this constraint, the
researcher should use questionnaire methods to collect data in a short time frame.

F. Definition of Terms

The following terms were defined according to how they are being used in the study:
Financial literacy. The ability to understand the basic knowledge of saving and
investing.
Financially literate. A person who knows the basic knowledge of financial literacy.
Saving. An act of keeping money for future purposes.
Budgeting. A plan on how to spend money.
Financial emergency. Unexpected life events that put a person at risk from a
financial security position.
Investment. An action of investing money for profit and growth.
Financial goals. Personal objectives, long-term or short-term that a person set for
how he or she will save or spend the money.
Financial management. The process of budgeting, saving, investing, and spending.
Young professionals. A teacher, nurse, accountant, business professional, or a
policeman that ranges the age of 20 to 35 years old and works for about 1 to 16
years.
 CHAPTER II
REVIEW OF RELATED LITERATURE

This chapter shows a retrospective presentation of previously written material:

research literature and conceptual that has relevance and significance to the
research under consideration.

A. Related Literature

Financial knowledge is an essential component in financial decision making. It

is important to young professionals to have a responsibility in saving their money
(Peter, 2015). Results from 2, 712 respondents in the National Longitudinal
Survey of Youth confirm that 79% are strongly educated in handling their money
and how to use it, 15% is in between strong and weak, and 6% are week in
financial literacy. These findings suggest considered the financial education of
each young individual. The results also highlight the importance of adopting
tailored financial literacy in each professional.

A study on financial literacy and its impact on investment decision of

professionals focused on factors of financial literacy and financial planning among
professionals (Kapoor, 2014). It found that the level of financial literacy and
financial planning among professionals is satisfactory. It also found that the
majority of respondents have a high level of financial literacy and are aware of
various aspects of financial planning and are able to plan on their own. Having a
plan for spending, saving, and investing money makes a difference in how well
financial needs and goals will be met. Meeting those goals require financial
planning that considers all aspects of finance like budgeting and managing taxes,
liabilities, purchase decisions, managing insurance, managing investment,
retirement and estate planning.

Nearly a third of young adults in a recent study were found to be ‘financially

precarious’ because they had poor financial literacy and lacked money
management skills and income stability (Gaurav Sinha, 2016). Only 22 percent of
the 18 to 24 year olds in the study sample were deemed to be financially stable.
About 36 percent of the people in the study were deemed to be ‘financially at risk’
because they had experienced a significant, unexpected drop in income during the
prior year.

In the study “The Mediating Effect of Financial Literacy to Young Professionals”

that was conducted by Dipendra Singh, Albert A. Abrenda, and Yoshimasa
Kageyama survey 924 young professionals to examine their personal financial
literacy. Results show that 53 percent of participants answered correctly and 47
 percent of participants answered inconsistently. It is concluded that more than
half of the respondents are knowledgeable about personal finance. This study
contributes to the literature by investigating the financial literacy to young
professionals.

Conceptual Framework

Demographic
Factors
a) age
Human Capital
b) gender
c) income
d) education
FINANCIAL LITERACY Financial Well -being
e) profession
f) length of service

Financial Behavior
Financial Factors
Long- term planning
a) savings
Short- term planning
b) borrowings
c) investments
d) insurance
e) retirement Other Influences
Financial
f) financial Education a) cultural
knowledge
b) personal
preferences
c) behavioral biases
B. Related Studies

Local Study

In the study “Financial Literacy of Young Professionals in the Philippines”

conducted by Neschelle Castro, Lia Salamat, and Malou Tabor, it revealed that
98% of the young professionals agrees that financial attitude’s factor analysis
should have detailed understanding. Attitude is mostly associated with the
perspective towards the future. This advice that young professionals must be
educated on the importance of setting long term financial goals and the means to
achieve them. The study aimed to examine financial literacy from a behavioral
perspective of the young professionals in the Philippines. This study has revealed
lack of financial literacy, since only 35% of the respondent are well aware of
financial wellness that results to poor financial management practices that
strongly affects them and thus, financial education is important to guide them.
Further, it was found that financial attitude reconciles the effect of financial
knowledge on behavior and hence, young professional need to have proper
attitude to benefit from financial knowledge.

Young professionals should be able to understand how and when investment

and savings literacy drives to being a responsible financial individual (Hernandes,
2018). A total number of 272 financially independent young professionals under
3o years old completed given questionnaires about financial literacy. The results
revealed that 65% are financially literate and 35% are not. According to these
results, there are more young professionals that seems to know how to manage
their money. Still, interventions are advised to those who didn’t passed to the
survey in order to improve financial behavior and to focus on the combination of
investment advice use and metacognitive strategies used by individuals to make
financial decisions.
Foreign Study

Individual’s financial capabilities such as financial knowledge, self- efficacy,

attitudes, and behaviors are important to have a good financial management
(Tang, 2013). Implementation of effective financial parenting, financial education
and intervention programs are needed for those young adults who may benefit
from these financial education and intervention efforts. A quantitative research
design was adopted and closed-ended questionnaires were used to collect primary
data from 263 young professionals working in the financial industry in Eastern
Cape. It was found that almost half of them reported above average (61% to 80%)
financial literacy levels. In terms of financial socialization mechanisms. parental
teaching and modelling and employer’s financial instruction positively influenced
the financial literacy of these young financial professionals while earned
allowance. It was recommended that financial educators should improve parent’s
levels of financial knowledge and promote positive parental financial behavior to
influence young professionals. This study demonstrates that parents and
employers have an important role to play an assisting with the financial literacy of
young professionals in the Eastern Cape.

Financial literacy has blossomed in use this century. Scholars, policy officials,
financial experts, and consumer advocates have used the phrase loosely to
describe the knowledge, skills, confidence and motivation necessary to effectively
manage money (Remund, 2015). A survey was given to 168 professionals
correlating to financial education and financial management. Results show that
61% were financially educated and rest still needs regulations and assessments. It
concludes that there are more financially educated professionals and that
financial education and management is essential to help professional financial
behavior.
 CHAPTER III
METHODOLOGY

This chapter covers the research design and methodology, including

sampling, population, establishing rigor during and after data collection,
ethical considerations and data analysis.

A. Research Design
A descriptive research design was selected to study the importance of saving
money to Senior High School students of St. Louise de Marillac College of Bogo, Inc.
An online survey questionnaire is administered to selected respondents in a
population. The survey involved a researcher-made questionnaires which sought to
obtain data on the sensory evaluation of the responses of the research respondents
answering the given questions in the survey.

B. Subjects of the Study

In this study, the respondents were drawn from young professionals of Bogo City
such as teachers, nurses, policemen and policewomen, accountants, and business
professionals that are 20 to 35 years old and have 1 to 16 years of service. They were the
chosen respondents of the research because they are the young professionals that play as
the subjects of the research conducted.

C. Sampling Technique

A purposive sampling is used in the study. This means that the researchers rely
on their own judgment when choosing members of the population to participate in
the study.
D. Research Instrument to be Used

The instrument used in the research is an online researcher-made

questionnaires which consisted of items that determined the financial literacy among
young professionals of Bogo City. In the preparation of the instrument, the
requirements in the designing of a good data collection instrument were considered.
In this way, the instrument is authorized to obtain valid responses of the
respondents. Preference for the use of the structured questionnaire is premised on
several research assumptions such as cost of being less expensive means of
gathering data, avoidance of personal bias, less pressure for immediate response,
and giving the respondents a greater feeling of anonymity. In the end, it encouraged
open response to sensitive issues at hand. In addition, the instrument was validated
by the teachers and consultants before it was laid to the study.

E. Procedure of Data Gathering

The researchers sought permission from the young professionals through email
before administering the survey questionnaire. Once approved, the researchers will
send the survey questionnaire to the respondents through to their official Gmail
account. After the administration of the questionnaire, the researchers will then
collect the data for tallying the responses and apply the statistical treatment for the
interpretation.

F. Statistical Treatment

Interpretation of Weighted Mean

Weighted Mean Result

1.00 – 1.70 Strongly Disagree

1.80 – 2.50 Disagree
2.60 – 3.30 Agree
3.40 – 4.10 Strongly Agree
G. Collection of Materials

The researchers gathered materials and information about the procedures,

benefits and risks of participating, an explanation how to acquire the results of the
research, availability of counseling services, voluntary participation, and contact
information of the researchers. The purpose of the study was also on the consent
form. The entire process of the research is based on the previous relevant studies,
articles, and statements that are interrelated to the topic. The survey in the form of
online questionnaires was also included to see the financial literacy among young
professionals of Bogo City.

H. Preparation of Treatment

The treatments were prepared in this study are exposed to some manipulation or
intentional change in the independent variable of interest. It will help to measure
effects as well as establish casualty. The researchers follow a certain formula given
by the adviser in order to get an answer to proceed in further statistical operations
and process. After this, the researchers then analyze and apply it in the study to help
the researchers find the solution.
 CHAPTER IV

This chapter presents the analysis and interpretation of data gathered from the study
conducted from the survey.

FIGURE 1

Age

19%
28.60%

23.80%

28.60%

20- 23 years old 24- 27 years old 28-31 years old 32- 35 years old

As shown in the pie graph above, it was found that there was a 28.60% of
respondents that are 20- 23 years old and another 28.60% of respondents that are
24- 27 years old. Followed by 23.80% that are 28- 31 years old and then followed by
19% that are 32- 35 years old.
 As conclusion, the majority of our respondents range from the ages of 20 – 27
years old.

FIGURE 2

Civil Status

23.80%

14.30% 61.90%

Single In A Relationship Married Separated

As shown in the pie graph above, it was found that 61.90% of the respondents
are single. Followed by 23.80% are married and then followed by the 14.30% are in a
relationship. Lastly, there are 0% or no respondents that are separated.

As conclusion, most of the respondents are single and no respondents are

separated.
 FIGURE 3

Sex

33.30%

66.70%

Male Female

As shown in the pie graph above, it was found that 66.70% of the respondents are
females and followed by the 33.30% of the respondents that are males.

As conclusion, the majority of the respondents are females.

 FIGURE 4

Job

20% 20%

20% 20%

20%

Teacher Nurse Accountant Police Business Professional

 As shown in the pie graph above, it was found that the percentage of jobs are 20%
teachers, 20% nurses, 20% police, 20% accountants, and 20% business
professionals.

As conclusion, the numbers of respondents in each professional are all the same.

FIGURE 5

Length of Years of Service/Work

23.80%

52.40%

23.80%

1- 4 years 5-8 years 9- 12 years 13-16 years

 As shown in the pie graph above, it was found that 52.0% of the respondents are
working for 1-4 years. Followed by a 23.80% of respondents working for 5-8 years and
another 23.80% of respondents that are working for 9- 12 years old. Lastly, there are 0% or
no respondents that are working for 13-16 years.

As conclusion, most of the respondents are working for 1-4 years. There are also no
respondents that are working for 13-16 years.

FIGURE 6

How much is your monthly income?

4.80%
4.80%
5% 19%

33%
33.30%

4,001 - 9,000 9,001 - 14,000 14,001 - 19,000 19,001 - 24,000

24,001 - 29,000 29,001 - 34,000 34,001 - above
 As shown in the pie graph above, it was found that 33.30% have a monthly income of
9,001- 14,000 pesos. Followed by 33% have 14,001- 19,000 pesos, 19% have 4,001- 9,001
pesos, 5% have 24,001- 29,000 pesos, 4.80% have 29,001- 34,000 pesos, and 4.80% have
34,001 pesos and above. Lastly, there are 0% or no respondents that have a monthly
income of 19,001- 24,000 pesos.

As conclusion, most of the respondents have a monthly income of 9,001 – 19,000 pesos.
 FIGURE 8

What are your sources of financial advice and

information?

9.50% 14.30%
19%

38.10% 47.60%

9.50%

19.00%

9.50%
9.50%
71%
9.50%
4.80%
Newspaper
Friends and Acquaintances
Advertising
Bank Officers and Employees of Insurance Companies
Specialized Websites
Independent Financial Consultant and Brokers
Family Members

Books and Financial Researches

Business Exposure
Seminars/ Webinars
Financial Adviser
Others

As shown in the pie graph above, it was found that 71.4% of the respondents got
their financial advice and information from their family members. Followed by 47.6% from
friends and acquaintances, 38.1% from seminars/webinars, 19% from newspaper and
books and financial researches, 14.3% from others, 9.5% from advertising, bank officers
and employees of insurance companies, specialized websites, business exposures, and
financial adviser, and 4.8% from independent financial consultant and brokers.

As conclusion, majority of the respondents depends on their family members as their

sources of financial advice and information.
 FIGURE 9

Indicate whether or not you consult financial

professional

33.30%

66.70%

Yes No

As shown in the pie graph above, 66.7% of the respondents consult financial
professional and 33.3% of the respondents don’t consult financial professional.

As conclusion, majority of the respondents consult financial professional for financial

advice and help.
 FIGURE 10

If you consult a financial professional or adviser,

specify the reason(s) for which you consult a
professional.
14.30%
9.50%

57.10%
23.80%

85.70%

Insurance- auto, life, and health Savings and investments Advice on mortgage or loan
Tax planning purpose Debt counseling

As shown in the pie graph above, 85.7% of the respondents go for savings and
investments. Followed by 57.1% for insurance- auto, life, and health, 23.8% advice on
mortgage or loan, 14.3% for debt counseling, and 9.5% for tax planning purpose.

As conclusion, most of the respondents consult a financial professional or adviser for

savings and investments.
 FIGURE 11

Indicate which form of financial education you have

received.

23.80%
47.30%
19%
4.80%

33.30%
54.60%

Employer-sponsored seminars Financial workshops Formal coursework on finance

College degree in finance Others None

As shown in the pie graph above, 54.60% of the respondents have college degree in
finance. Followed by 47.30% for none, 33.3% for others, 23.8% for employer- sponsored
seminars, 19% for financial workshops, and 4.8% for formal coursework on finance.

As conclusion, half of respondents have a college degree on finance as a form of

financial education that has been received.
 FIGURE 12

Do you maintain a budget on your expenditure?

4.80%

95.20%

Yes No

As shown in the pie graph above, it was found that 95.2% of the respondents maintain
a budget on their expenditure and 4.8% are not.

As conclusion, majority of the respondents maintain a budget on their expenditure.

 FIGURE 13

How is your monthly income being spent?

9.50%

71.40% 90.52%

47.60% 28.60%

57.10%

85.70% 19%
23.80%

Household expenses Health Care School fee

Insurance Transportation Debt
Entertaiment and Recreation Savings and Investments Others

As shown in the pie graph above, 90.52% of the respondents spend their monthly
income for household expenses. Followed by 85.7% for transportation, 71.4% for savings
and investments, 57.2% for debt, 47.6% for entertainment and recreation, 28.6% for health
care, 23.8% for insurance, 19% for school fee, ad 9.5% for others.

As conclusion, most of the respondents spend their monthly income mainly for
household expenses, transportation, and savings and investments.
 FIGURE 14

Do you have savings?

4.80%

95.20%

Yes No

As shown in the pie graph above, 95.2% of the respondents have savings and 4.8%
doesn’t have.

As conclusion, majority of the respondents save money.

 FIGURE 15

How would you describe your savings behavior?

4.30%

42.90%

52.40%

I always save I sometimes save

I don’t save even though I could I do not save because my income is insufficient

As shown in the pie graph above, 52.40% of the respondents sometimes save money.
Followed by 42.90% for the respondents that always save, and 4.3% for the respondents
that do not save because their income is insufficient. Lastly, there is 0% or no respondents
that do not save even though they could.

As conclusion, half of the respondents sometimes save money.

 FIGURE 16

If your answer is "I always or sometimes save," what

do you save towards?
14.30%

42.90%
66.70% 23.80%

28.60%

57.10%
66.70%

Investment income Insurance Retirement plan Emergency purposes

Personal Purposes Financial Expenses Others

As shown in the pie graph above, 66.7% of the respondents save towards emergency
purposes and financial expenses. Followed by 57.1% for personal purposes, 42.9% for
investment income, 28.6% for retirement plan, 23.8% for insurance, and 14.3% for others.

As conclusion, most of the respondents save money towards emergency purposes,

financial expenses, and personal purposes.
 FIGURE 17

How much do you put aside (save) for investment

and/or emergency?

23.80%

76.20%

Less than 10% of my monthly income 10-20% of my monthly income

20-30% of my monthly income Over 30% of my monthly income

As show in the pie graph above, 76.20% of the respondents save less than 10% of
their monthly income for investment and/or emergency. Followed by 23.80% for 10-20% of
their monthly income, and 0% or no respondents for 20-30% and over 30% of their monthly
income.

As conclusion, most of the respondents save less than 10% of their monthly income
for investment and/or emergency.
 FIGURE 18

Which is your most preferred saving avenue?

19%
9.50%

19% 76.20%

14.30%

Bank deposit Insurance Financial cooperative All of the Above None

As shown in the pie graph above, 76.2% of the respondents choose bank deposit as
their most preferred saving avenue. Followed by 19% for financial cooperative, 19% for
none, 14.3% for insurance, and 9.5% for all of the above.

As conclusion, majority of the respondents choose bank deposit as their most

preferred saving avenue.
 FIGURE 19

Do you have investment ?

23.80%

76.20%

Yes No

As shown in the pie graph above, 76.2% of the respondents have an investment and
23.8% doesn’t have.

As conclusion, majority of the respondents invest their money.

FIGURE 20
 FIGURE 21

FIGURE 20

How often do you invest ?

19.00%

42.80%
9.50%

28.60%

Monthly Quarterly

As shown in the pie graph above, 42.9% of the respondents invest annually. Followed
by 28.6% for twice a year, 19% for monthly, and 9.5% for quarterly.

As conclusion, almost half of the respondents invest money annually.

 Among the following, which are the investment
avenues that you are aware of?

4.80%
19%

28.60% 76.20%

33.30%
14.30%

0%

Insurance Shares Debentures Real Estate Stock Market All of the Above Others

As shown in the pie graph above, 76.2% of the respondents choose insurance.
Followed by 33.3% for real estate, 28.6% for stock market, 19% for others, 14.3% for
shares, 4.8% for all of the above. Lastly, there is 0% or no respondents who choose
debentures

As conclusion, majority of the respondents are aware of insurance as an investment

avenue.
 FIGURE 23

FIGURE 22

Among the following, which are the investment

avenues that you avail?

38%
52.40%

4.80%
28.60% 9.50%
9.50%

0%

Insurance Shares Debentures Real Estate Stock Market All of the Above Others

As shown in the pie graph above, 52.4% of the respondents avail insurance. Followed
by 38.1% for others, 28.6% for stock market, 9.5% for shares and real estate, 4.8% for all of
the above, and 0% or no respondents for debentures.

As conclusion, half of the respondents avail insurance among the investment

avenues.
 What factors do you consider before investing
money?

57.10%
76.20%

62%
61.90%

Safety capital Risk Rate of return Period of investment

As shown in the pie graph above, 76.2% of the respondents choose safety capital.
Followed by 62% for rate of return, 61.9% for risk, and 57.1% for period of investment.

As conclusion, most of the respondents choose safety capital as the greatest factor to
consider before investing money.
 FIGURE 25

FIGURE 23

How would you like to make an investment?

14.30%

85.70%

A fixed amount on a regular basis Invest on a regular basis but not a fixed amount
Make a lump sum payment

As shown in the pie graph above, 85.7% of the respondents choose a fixed amount
on a regular basis. Followed 14.30% for invest on a regular basis but not a fixed amount
and 0% or no respondents choose to make a lump sum payment.

As conclusion, majority of the respondents make an investment on a fixed amount

on a regular basis.