Luna St.

, La Paz, Iloilo City, 5000 Philippines

Telefax: (033) 320-0846 E-mail: contactus@iloilonhs.edu.ph

Relationship between the Financial Literacy and Spending Habits of Grade 12 Iloilo
National High School Students

A RESEARCH PAPER

Presented to
MRS. YOLLY B. SUERTE
Faculty, Senior High School
ILOILO NATIONAL HIGH SCHOOL

In Partial Fulfillment
of the Requirements in Practical Research 2
(Quantitative Research)

Paul Joseph D. Abada

Paul Gabriel T. Barranco
Ma. Janel B. Casumpang
Stephanie G. Duhina
Angelie Rose B. Genzola
Angeli S. Jaleco
Ella C. Laza
Jannah Louise O. Linga
Angelie Marie G. Mijares
Jewel Mae C. Supe
Deryn Dominique V. Ventilacion

ABM 11 – A

August 2019
 Luna St., La Paz, Iloilo City, 5000 Philippines
Telefax: (033) 320-0846 E-mail: contactus@iloilonhs.edu.ph

Chapter 1

Introduction to the Study

Background of the Study

At present, students are struggling on how to budget their money due to multiple

reasons, which include high inflation rate, insufficient allowance, temptations, peer

pressure, financial illiteracy, and many more. Due to this, they end up having little to no

savings at all. Scholarly institutions have big roles in developing the well being of an

individual. This is in line with the development of educational curricula that focus on the

development of active citizenship (Amagir, Groot, den Brink, and Wilschut, 2017).

Currently, schools offer business and finance-related subjects for some college students

and senior high school (SHS) students taking up Accountancy, Business, and

Management (ABM) Strand only. Unfortunately, non-ABM Strand, junior high school,

and elementary students do not have these subjects that can somehow improve their

financial literacy. However, learners are still financially illiterate because these subjects

are only focused on theories and the technical side of the lesson, not specifically on the

practical application of budgeting finances.

One of the many solutions that can help learners budget their financial resources

is to change their daily spending habits through financial literacy.

 Luna St., La Paz, Iloilo City, 5000 Philippines
Telefax: (033) 320-0846 E-mail: contactus@iloilonhs.edu.ph

According to Lusardi (2019), an essential indicator of people’s ability to make financial

decisions is their level of financial literacy. With this, students would be more educated

and able to understand how money works, as well as possess the necessary skills and

abilities to use financial resources in making decisions such as

spending, saving, and investing money. Financial literacy can be seen as an investment

in human capital, and can be helpful in decision-making about pensions, savings,

mortgage, and other financial decisions (Lusardi and Mitchell, 2014).

Society requires each individual to assume a certain responsibility in his or her

finances. In the context of finances and money, it is very important to be prompt with

bills and financial obligations making sure that these are well maintained and paid up to

date; literacy in the field of finances would either have a positive or negative impact in

being a citizen. Being financially literate means having good spending habits that leads

to making informed and effective monetary decisions without much thought and regret in

the end.

In this study, the researchers wanted to find out the relationship that exists

between the financial literacy of students and their spending habits.

 Luna St., La Paz, Iloilo City, 5000 Philippines
Telefax: (033) 320-0846 E-mail: contactus@iloilonhs.edu.ph

Research Objectives and the Hypothesis

General Objectives

This study aimed to determine if there is a relationship between the financial

literacy and spending habits of Grade 12 Iloilo National High School (INHS) students

Specific Objectives

Specifically, this study aimed to determine the:

 level of knowledge of Grade 12 INHS students in finance when taken as a

whole and grouped according to strand;

 spending habits of Grade 12 INHS students when taken as a whole and

grouped according to strand; and

 significant relationship between the financial literacy and spending habits

of Grade 12 INHS students;

In view of the preceding specific questions, this hypothesis is advanced:

There is no significant relationship between the financial literacy and spending

habits of Grade 12 Iloilo National High School (INHS) students.

 Luna St., La Paz, Iloilo City, 5000 Philippines
Telefax: (033) 320-0846 E-mail: contactus@iloilonhs.edu.ph

Significance of the Study

The results of the study will benefit the following:

Department of Education- They can address the effectiveness of the curriculum,

and materials used in finance-related subjects.

Iloilo National High School- They can see how well the learners have grasped the

teachings of the school,

Teachers- This study will provide insights on the effectiveness of the teaching

methods they use in the classroom.

Parents- Parents will be able to know how their children spend daily, and how

they budget their finances.

Students- Students can learn to practice good spending habits, and apply their

learning in real life situations.

Future Researchers- This study can provide useful information for future studies.
 Luna St., La Paz, Iloilo City, 5000 Philippines
Telefax: (033) 320-0846 E-mail: contactus@iloilonhs.edu.ph

Definition of Terms

The following terms were defines as how they were used in the study:

Financial literacy. The education and understanding of various financial areas

including topics related to managing personal finance, money and investing. (Kenton,

2019)

In this study, this refers to the capacity of the students that will determine the

level of knowledge in dealing with money or cash.

Spending habits. The amount that individuals and households spend on goods and

services such as food, alcohol, clothing and health care and the frequency at which they

do so. (RateCity, 2019).

In this study, this refers to the quantifiable behavior of students that will be

measured by the researchers.

Budgeting. A process of creating a plan to spend money in order to balance your

expenses with your income (myMoneyCoach, 2019).

In this study, this refers to how students allocate their allowances to pay for their

daily expenses.
 Luna St., La Paz, Iloilo City, 5000 Philippines
Telefax: (033) 320-0846 E-mail: contactus@iloilonhs.edu.ph

Scope and Delimitation of the Study

The study is quantitative in nature and aimed to determine the relationship

between the financial literacy and spending habits of Grade 12 INHS students.

The research will use survey questionnaires with detailed questions pertaining to

the students’ daily or weekly allowances and their average spending per week. It will also

include questions pertaining to a basic understanding of money, savings, and debt. A

research teacher will review the data-gathering tool and authenticate its validity. This

study will be conducted in Iloilo National High School during the months of August until

October. The research sample will be composed of one hundred (100) randomly selected

students, from the different strands and tracks. The study will be carried out through the

use of survey questions as a means of determining the financial literacy and spending

habits of the respondents. The research data will be based on the level of financial

literacy and average spending of the respondents. The study will be limited to Grade 12

students of INHS.
 Luna St., La Paz, Iloilo City, 5000 Philippines
Telefax: (033) 320-0846 E-mail: contactus@iloilonhs.edu.ph

References

Amagir, A., Groot, W., van den Brink, H., & Wilschu, A. (2017). A review of financial-

literacy education programs for children and adolescent. Retrieved from

https://journals.sagepub.com/doi/10.1177/2047173417719555

Kenton, W. (2019). Financial Literacy. Retrieved from https://www.

investopedia.com/terms/f/financial-literacy.asp

Lusardi, A. (2019). Financial literacy and the need for financial education: evidence and

implications. Retrieved from https://link.springer.com/article/10.1186/s41937-

019-0027-5

Lusardi, A. & Mitchel, O.S. (2014). The economic importance of financial literacy:

Theory and evidence. Journal of Economic Literature 52(1): 5-44

myMoneyCoach. (2019). What is Budgeting? What is a Budget?. Retrieved from

https://www. mymoneycoach.ca/budgeting/what-is-a-budget-planning-forcasting

RateCity. (2019). Spending Habits. Retrieved from https://www.ratecity.com.au

/search/spendinghabits?q=spending%20habits&page=2