EFFECT OF THE FINANCIAL PROBLEM ON THE BEHAVIOR AND ACADEMIC

PERFORMANCE OF SELECTED GRADE 11 STUDENTS OF ST. John ACADEMY

OF VISUAL AND PERFORMING ART ACADEMIC 2019-2020

Group member

Carpio, Kyle
Macahia, Jomar
Fernandez, Royce Red
Salisi, Maxine Dennise
Sangalang John, Mark

Teacher:
Camille Joy, Platon
 CHAPTER 1

INTRODUCTION

“No money no talk”. Money, money and money. People always mentioned this word in

their life. Do you think money is important in our life besides food, shelter and love? If

you think so, then why we need it? Nowadays, we always heard about bank robbery, snatch

thefts, loan sharks and others through media. Why did these crimes happened? It is because

they have financial Problem In their life until they involved in crimes. Financial problem

also happened among Students especially when they further their study away from their

hometown. Students always complaint about sort of money. One of the core principles of

positive psychology is that character strengths buffer the effects of adverse experiences on

well-being. This study investigated whether external locus-of-hope (LOH) moderates the

effects of financial stress on Filipino students’ well-being. Students from various

universities answered questionnaires that included scales for financial stress, internal and

external LOH, and satisfaction with life; all the relevant scales had good psychometric

properties with the current sample. As expected, life satisfaction was negatively predicted

by financial stress and positively predicted by three LOH dimensions. More importantly,

external-family LOH moderated the relationship between financial stress and life

satisfaction; there was no negative relationship between financial stress and life satisfaction

among students with high external-family LOH. But the results also suggest that financial

stress moderates the relationship between external-spiritual LOH and life satisfaction;

external-spiritual LOH’s positive relationship with life satisfaction is found only among

those who experience low financial stress. Financial literacy has become one of the most

concerned issues in the developed countries in recent years especially after the economic
crisis of 2008 since the effects of personal finance are significant to societies. Prior to the

economic crisis of 2008, studies on financial literacy were scarce in academic journals, but

governments of many developed countries however gave the needed attention to the issue

of financial literacy after the crisis. For instance, there was an advisory committee on

personal finance which was put in place to encourage financial literacy awareness among

Americans after the economic crisis. The idea of personal finance has been described in

the literature as the awareness and use of financial knowledge in our day to day economic

activities. It is therefore the application of financial knowledge and terminologies by

individuals in order to make a rational decision. Many academic researchers in the field of

personal finance have chosen to define the concept as “the ability to make informed and

efficient judgment regarding the use and management of money (Schengen and lines, 1996).

Personal finance literacy is however conceptualized on certain critical areas in finance such

as savings and borrowing, interest rate, budgeting and financial knowledge

(Chen and volte, 1998; Remand, 2010). Past Studies have revealed that Americans tend to

have a higher rate of consumption compared to their savings rate. This consequently led

the country into a total negative savings rate (Sullivan et al, 2008).

This then calls for the need for United States government to inculcate financial literacy

among Americans and thus explains why educators, policy makers and
STATEMENT OF THE PROBLEM

This paper examines the reasons students have poor financial management, excessive

spending behavior and living away from family are the causes of financial problems among

college students. First of all, poor financial management is the main cause students are

facing financial problem.

1. How the financial does affects the students?

2. Financial problem does affects the studies?

3. Hardworking for Financial Problems can affect your Studies? or not?

CONCEPTUAL FRAMEWORK

INPUT PROCESS OUTPUT

1. How does 1. Interviews 1. Tuition fee
financial affects issue.
2. Make a
student?
research 2. Think about
2. How does their financial.
financial affects
3. Hard working
studies?
on part time job
3. How does
hardworking for
Financial
Problems affect
studies?
SIGNIFICANCE OF THE STUDY

In the current financial and political environment, it is crucial that institutions understand

the relationship between students’ academic and financial decisions and university policy.

This research is intended to provide needed insight to the relationship between students’

financial standing, priorities, experience, and decision making in regard to academic

performance and ultimately to time-to-degree. This increased understanding will allow

universities to either; 1) defend the length of time that students spend to earn a degree as

being desirable by contributing to their education, or 2) implement policies that motivate

students to graduate sooner. With the information provided by the models resulting from

this study, overall academic motivations, financial motivations and behavior can be linked

to student academic efficiency and more effectively influence policy.

SCOPE AND DELIMITATION

This research will only include the grade 11 student that effect of financial problem on

the behavior and of St. John academy of visual and performing art academic 2019-2020.

This study will also include the effects of failure students in the academic performance and

the possible job opportunities in the future.

This research will only include the students who are currently studying at the St. John

academy of visual and performing art academic for the School year 2018-2019.

HYPOTHESIS

There is significant relationship between the students that effect of financial problem on

the behavior and of St. John Academy of Visual and Performing Arts. There is no

significant relationship between the Sustainability of the student that effect of financial

problem on the behavior and of St. John academy of visual and performing.
 CHAPTER 2

REVIEW OF RELATED LITERATURE

This chapter does a review on relevant literature from articles, journals, books and

publications on financial literacy among senior high students. This chapter also forms the

theoretical and empirical basis upon which the study is conducted. The chapter therefore

considers the academic theories and the various views expressed by scholars on the topic.

FOREIGN LITERATURE

The concept can also be looked at from a broader perspective as OECD (2005) defines

financial literacy as “the process by which individuals improve their thought about

financial concepts through communication and instruction to make individuals confident

and aware of financial risks and opportunities so as to achieve financial well-being.

Remand (2010) tries to conceptualize the definition of personal financial literacy into five

categories which include; knowledge of financial concepts, ability to communicate about

financial concepts, aptitude in managing personal finances, and skill in making appropriate

financial decisions, and confidence in planning effectively for future financial needs. This

implies that financial literacy goes beyond the effective use and management of money and

considers other important areas in finance.

U.S. Financial Literacy and Education Commission (2007) have also defined financial

literacy as the capacity to apply ideas and skills to effectively manage financial resources

in order to achieve a long lasting financial soundness

Financial literacy equips people with requisite information and ideals needed to make

sound decisions with accuracy to manage financial resources and to improve financial

capability to call for better financial services (Ali, 2013).

The concept then enables people to be prudent in all financial engagements. A persons‟

level of education does not necessarily correspond with how individuals understand and

apply the concept in their human endeavors. It is therefore prudent for all and sundry to

pay attention to personal finance literacy since an in-depth knowledge in financial literacy

tends to have a direct impact on the management of the economy (World Bank, 2009).

An in-depth knowledge in personal finance helps individuals as well as the communities

to improve their decision-making capacity. According to Bruine de bruin et al. (2010),

people who are not inclined in financial literacy tend to have higher anticipation for

inflation which consequently affects their whole being since inadequate personal finance

knowledge will limit a person’s ability to make well versed financial decisions and

eventually engaged in impulse buying.

Many scholars in the field of personal finance have indicated that parents have essential

impact on their children consumption pattern as it has been shown in the literature that

children tend to develop their money management processes from 14 parents (Pinto et al.,

2005)

Parents then influence the way children handle money and instill the attitudes their children

have towards savings (Eikmeier, 2007)

The impact of peer groups on children is however centered on the attitude of the children

as literature has shown that peer group influence impacts positively towards the learning

behavior of children in relation to money management (Hayta, 2008).

FOREIGN STUDIES

Avard et al. (2005) reveals that graduates from high schools lack the understanding of basic

personal finance issues. This emphasizes that most students find it difficult to balance a

checkbook and lack the basic principles in finance (Avard, Manton, English and Walker,

2005). Another academic work conducted by A National Council on Economic Education

study (2005) indicates that 53 per cent of senior high students performed woefully on the

basic quiz on economics and personal finance in the United States. This stresses that there

is inadequate personal finance among senior high students and that have had a negative

effect on their financial decisions and behavior.

High school students therefore leave school without the basic skills to manage their

personal financial affairs, putting them at a high risk for not being able to plan responsibly

for their financial future. The ability of senior high school students to deal with financial

difficulties is dependent on financial exposure gained before entering college (Lyons,

Scherpf, and Roberts, 2006).

Financial literacy quiz used for the study was centered on basic money management.

Worthington (2006) used logit regression 17 models to forecast personal financial literacy

of Australian adults. The study reveals that personal finance tends to be adequate among

individual with ages aged between 50 and 60 years, professionals, business and farm

owners.
This survey also indicates that personal finance tends to be lowest for unemployed and

woman. Another study by Almenberg and Soderbergh (2011) tries to find out whether there

is the essential difference between planners and non-planners of Swedish adults in terms

of personal finance. The study concluded that there is inadequate personal finance among

older people, women and those with low education or earnings.

Although financial behavior tends to have direct relationship with financial literacy, the

impact of financial education on personal finance behavior is not certain. This 18 means

that there are some doubts as to how financial education affects financial behavior (Lyons,

Palmer, Jayaratne, and Scherpf, 2006). Mandell (2006) on the other hand indicated that

well-planned high school personal finance course tends to have less significance on

students behavior especially from 1 to 5 years after completion.

Financial literacy has become an important component in financial decision-making after

the emergence of the world financial crisis in 2008. The world however gave the needed

attention to the issue after the financial crisis and its distribution impacts. Personal finance

is then seen as the means to ensure accelerated economic growth and development.

Societies which are equipped with personal financial issues are confident in dealing with

financial issues they may encounter. Hence, it stands to reason that people with low

financial literacy are not able to participate actively in the stock market (Rooij, Lusardi,

and Alessie, 2007) and tend to accumulate more debt without planning (Lusardi and

Turfano, 2009). The low level of financial literacy could make small financial issues

become overwhelming which could turn into financial stress and consequently affects the

total being of the people.

To examine how well equipped young people are to make financial decisions, we analyzed

financial literacy questions newly added to the National Longitudinal Survey of Youth

fielded in 2007-2008. This rich dataset was used to study the relationship between financial

literacy and respondents’ sociodemographic characteristics, family characteristics, and

peer characteristics. Three key research questions were addressed: 1) How well-equipped

are young people to make financial decisions? 2) What are the determinants of financial

literacy among young people? 3) How can this information aid policymakers seeking to

devise interventions aimed at young consumers? Results will be of interest to policymakers

concerned with financial well-being and the balance between personal and institutional

responsibility.

Financial behavior. People with low financial literacy are more likely to have problems

with debt (Lusardi and Tufano 2009), less likely to participate in the stock market (van

Rooij, Lusardi, and Alessie 2007), less likely to choose mutual funds with lower fees

(Hastings and Tejeda-Ashton 2008), less likely to accumulate wealth and manage wealth

effectively (Stango and Zinman 2007; Hilgert, Hogarth, and Beverly 2003), and less likely

to plan for retirement (Lusardi and Mitchell 2006, 2007a, 2009). Financial literacy is an

important component of sound financial decision-making, and many young people wish

they had more financial knowledge. In a 2009 survey on credit card use among

undergraduate students, 84% of students said they needed more education on financial

management topics, 64% would have liked to receive information about financial

management topics in high school, and 40% would have liked to receive such information

as college freshmen (Sallie Mae 2009). Understanding financial literacy among young

people is thus of critical importance for policymakers in several areas; it can aid those who
wish to devise effective financial education programs targeted at young people as well as

those writing legislation to protect younger consumers.

LOCAL LITERATURE

Financial Situation in the Philippines According to figures from the National Statistics

Office of the Philippines, unemployment stands at 7.6%, and underemployment at 19.8%

(July 2009 figures). These figures do not tell the full story. The definition of employment

includes 10.5% of workers as? Unpaid family workers? And many jobs provide a salary

that is barely enough to survive on (National Statistics Office). The 2006 poverty incidence

rate for the Philippines is 32.9% of the population (National Statistical Coordination Board).

The Philippines is falling behind its regional neighbors of Malaysia, Vietnam, Korea and

Indonesia when it comes to economic growth. While the other nations are moving forward

as Newly Industrialized Countries, the Philippines has a population growth approximately

2% per annum, meaning the number of poor could rapidly increase (CIA World Fact book).

Another problem is the unequal distribution of wealth in the Philippines. A small number

of rich families living in the major cities control the majority of the wealth, while people

in rural areas are getting poorer. In 2006, the richest 10% of families earned more than the

poorest 70% of families combined (National Statistics Office, 2003 and 2006 Family

Income and Expenditure Survey, Final Results). Even more telling is the fact that the ten

richest families earned as much as the poorest nine million families, making up half the

Filipino population.
Another major issue is urban migration, where many rural workers move to the cities

looking for work, and end up living in squalid conditions with poor prospects for work.

Yet this still seems more attractive than living in the rural areas, as the poorest rural regions

are cruelly situated in the areas most susceptible to natural disasters such as typhoons,

landslides and the effects of climate change. There is a drastic need to address the economic

conditions in the Philippines, and assist the poorest of the poor. A concerted effort needs

to be made to address the distribution of wealth, legislation issues hampering the poor,

environmental conditions, population growth and poverty.

One of the fundamental principles of positive psychology is that character strengths buffer

the effects of stress and other negative experiences on the well-being of individuals (Gable

& Haidt, 2005; Park & Peterson, 2009). Character strengths like gratitude, forgiveness, and

hope are thought to be associated with more adaptive forms of coping with these stressful

experiences (Harzer & Ruch, 2015). Among Filipino students, a possible source of stress

relates to financial difficulties that students or their family’s experience. In this study, we

inquired into the possible buffering effects of hope on the negative effects of financial

stress on life satisfaction of a sample of Filipino students.

LOCAL STUDIES

Including the sources of stress (Calaguas, 2012; Pengpid, Peltzer, & Ferrer, 2014),

responses to stress (Dy, Espiritu-Santo, Ferido, & Sanchez, 2015; Labrague et al., 2017),

and various psychological and educational correlates of stress (Calaguas, 2011; Pengpid et

al., 2014; Reyes et al., 2016; Tamanal, Park, & Kim, 2017). There is a noticeably higher

frequency of published studies on stress-related experiences of nursing students in the

Philippines (e.g., Labrague, 2014; Labrague et al., 2017), which may be explained by the
continuing rise in enrollment in nursing programs in the Philippines. A few studies have

inquired into stress-related experience as symptoms of more complex psychological

problems of students (e.g., Gingrich, 2009; Sta. Maria et al., 2015). Interestingly, even with

the increase in the number of published studies tackling stress experienced by Filipino

students, there seems to be more studies on the subject with Filipino-American students

(e.g., Nadal, Pituc, Johnston, & Esparrago; 2010; Wei, Ku, & Liao, 2011), which suggests

that more research could definitely be done on stress-related experiences of Filipino

students.

Experiencing financial stress is not unlikely among Filipino students, and government

statistics suggest that a significant proportion of the school-age population experience

financial difficulties. Starting at the basic education level, almost 20% of Filipino children

who dropped out of school mentioned insufficient financial resources as the main reason

for quitting school (Philippine Statistics Authority, 2015). Dropping out of school was most

probable among 17-year olds, particularly among those from the lowest income families

(Reyes, 36 Financial Stress and Well-being Tabuga, Asis, & Mondez, 2015). In the college-

age population, the top reason (mentioned by 37.58%) for not going to college or university

was the high cost of higher education; moreover, about 16.0% of those who opted not to

pursue higher education report that they did so in order to look for work to earn money for

their families (Reyes et al., 2015). In the current study, we hypothesized that financial stress

would be negatively related to subjective well-being, or specifically, life satisfaction of

Filipino students. There are currently no published studies that show this relationship with

a Filipino sample. One recent study did not actually measure financial stress, but showed
that sense of poverty was associated with the experience of psychological distress among

students (Reyes & Yujuico, 2014).

The primary purpose of the current investigation is to explore whether external LOH

dimensions will moderate the negative impact Bernardo & Resurreccion 39 of financial

stress on Filipino students’ life satisfaction. With this main objective, our study hopes to

contribute towards providing further evidence on the importance of external LOH in

people’s well-being, and university students’ well-being in particular. More importantly,

because there is so far very little evidence on the buffering effects of external LOH on the

negative effects of adverse experiences on wellbeing, our study would hopefully contribute

towards further building up the evidence on this subject. Such evidence will provide

stronger arguments in support of the important role of external LOH as a character strength

that promotes well-being by way of moderating the effects of stress. In line with the study’s

primary purpose, we propose three hypotheses: H1: Financial stress will negatively predict

life satisfaction; H2: Internal and external-family LOH will positively predict life

satisfaction; and H3: LOH dimensions will moderate the negative relationship between

financial stress and life satisfaction (although we cannot specify which among the LOH

dimensions would do so).

Although there is an increasing body of evidence on the positive correlates of external LOH,

there is actually only one published study that demonstrated a buffering effect of external

LOH. In a study of Filipino university students, Datu and Mateo (2017) found that external-

peer LOH moderated the negative impact of discrimination on various measures of students’

well-being: In particular, students with high external-peer LOH maintained good well-

being even if they experienced discrimination. We make a similar argument regarding the
moderating effect of locus-of-hope as in this previous study (Datu & Mateo, 2017). That

is, the belief that external agents would play an important role in attaining one’s important

goals would lessen the harmful effects of financial stress by serving as additional resources

for the individual to deal with stressful experiences. That external agents would serve this

function is consistent with locus-of-hope model’s assumption of conjoint forms of agency

(i.e., external agents play roles in one’s goal-pursuit) that underlie external loci-of-hope

dimensions. But the moderating effect found by Datu and Mateo (2017) involved an

external LOH dimension that has not been consistently associated with positive well-being

indicators, and as such, we cannot assume that the buffering effects of LOH are necessarily

associated with those LOH dimensions that have known correlations with well-being. So

our final hypothesis is less specific than the previous two: We hypothesize that some

external LOH dimensions would moderate the negative relationship between financial

stress and well-being.

According to an old review of published psychology research in the Philippines, stress and

coping has been one of the most intensively researched topics among Filipino psychology

researchers (Bernardo, 1997). But there were hardly any studies that focus on stress

experiences of Filipino students in that review, a trend that has improved somewhat in the

last decade with the publication of some studies on Filipino students’ stress-related

experiences. This observation reflects a similar trend in other parts of the world where

research on stress experienced by higher education students came relatively late compared

to stress research on other populations (Michie, Glachan, & Bray, 2001). As a reflection of

this trend in other countries, research on stress in higher education students has increased

in the past two decades, and psychologists now have a better understanding of the range of
stressors for students (Robotham & Julian, 2006) and factors related to students’ stress

(Beiter et al., 2015). Various psychological assessment tools have also been developed to

measure higher education students’ stress (e.g., Ross, Niebling, & Heckert, 1999; Sarafino

& Ewing, 1999) and general measures of stress have been adapted or validated for use in

specific populations of college students (Camacho, Cordero, & Perkins, 2016; Chan &

Bernardo, 2017).

One of the sources of stress for students that has been observed among higher education

systems in different parts of the world relates to financial pressures (Aherne, 2001; Joo,

Durband, & Grable, 2008; Roberts, Golding, Towell, & Weinreb, 1999). Not surprisingly,

stress related to financial strain and uncertainty has a negative impact on student well-being

(Mahmoud, Staten, Hall, & Lennie, 2012; Smyth, Hockemeyer, Heron, Wonderlich, &

Pennebaker, 2008). Students’ financial stress is associated with higher self-reported mental

health needs (Hyun, Quinn, Madon, & Lustig, 2006), difficulties in college adjustment

(Meehan & Negy, 2003), and a range of adverse behaviors, social relations, and academic

outcomes (Adams, Meyers, & Beidas, 2016; Northern, O’Brien, & Goetz, 2010).