Factors affecting personal financial management behavior: Evidence from Vietnam, 2022

HO CHI MINH CITY, 2022

THE STATE BANK OF VIETNAM MINISTRY OF EDUCATION AND TRAINING

HO CHI MINH CITY UNIVERSITY OF BANKING

BUI NGUYEN THIEN PHUC

FACTORS AFFECTING PERSONAL FINANCIAL

MANAGEMENT BEHAVIOR: EVIDENCE FROM

VIETNAM

GRADUATION THESIS

MAJOR: FINANCE - BANKING

CODE: 7340201

HO CHI MINH CITY, 2022

THE STATE BANK OF VIETNAM MINISTRY OF EDUCATION AND TRAINING

HO CHI MINH CITY UNIVERSITY OF BANKING

STUDENT: BUI NGUYEN THIEN PHUC

ID: 030805170130

CLASS: HQ5 – GE02

FACTORS AFFECTING PERSONAL FINANCIAL

MANAGEMENT BEHAVIOR: EVIDENCE FROM

VIETNAM

GRADUATION THESIS

MAJOR: FINANCE - BANKING

CODE: 7340201

SUPERVISOR

NGUYEN THI MY HANH, PHD

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ABSTRACT

When it comes to the Covid-19 pandemic, it makes people think of many

negative stories. However, somewhere, the Covid-19 pandemic has brought positive

changes for many people in terms of personal financial management behavior. This

study provides empirical evidence that the Covid-19 pandemic and many other

factors such as financial attitudes, financial well-being, and financial socialization

have an impact on personal financial management behavior. However, the study

also had another surprising result that financial knowledge did not affect personal

financial management behavior. Because of this research result, the research team

suggest that there should be a change in financial education in schools.

Key words: Personal financial management behavior, financial knowledge,

financial attitude, financial well-being, financial socialization, Covid-19.

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TÓM TẮT

Khi nhắc tới đại dịch Covid-19, nó khiến nhiều người nghĩ tới nhiều câu

chuyện tiêu cực. Tuy nhiên, ở một khía cạnh khác, đại dịch Covid-19 vẫn mang lại

những thay đổi tích cực cho nhiều người về hành vi quản lý tài chính cá nhân. Bài

nghiên cứu này cung cấp bằng chứng thực nghiệm cho thấy đại dịch Covid-19 cùng

nhiều yếu tố khác như thái độ tài chính, hạnh phúc tài chính, xã hội hoá tài chính có

tác động tới hành vi quản lý tài chính cá nhân. Tuy nhiên, nghiên cứu cũng có một

kết quả bất ngờ khác là kiến thức tài chính không ảnh hưởng tới hành vi quản lý tài

chính cá nhân. Chính kết quả nghiên cứu này khiến tác giả đề xuất về việc cần có sự

thay đổi trong giáo dục tài chính ở các trường học tại Việt Nam.

Từ khóa: Hành vi quản lý tài chính cá nhân, kiến thức tài chính, thái độ tài chính,

hạnh phúc tài chính, xã hội hóa tài chính, Covid-19.

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AUTHOR’S DECLARATION

Fullname: Bùi Nguyên Thiên Phúc

Student class: HQ5 - GE02, faculty of Banking and Finance, Ho Chi Minh

University of Banking.

Student code: 030805170130

I declare that this thesis entitled: ―Factors affecting personal financial

management behavior: Evidence from Vietnam‖, is entirely original with no prior

publication. The information presented on this subject is accurate and original. The

data in the tables that are used for analysis, commentary, and review is gathered

from many sources listed in the reference section. I assume completely

responsibility for the information in my dissertation if any fraud is discovered.

Ho Chi Minh City, November 2022

Bùi Nguyên Thiên Phúc

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ACKNOWLEDGEMENT

Firstly, I want to start by expressing my gratitude to my suppervisor, PhD.

Nguyễn Thị Mỹ Hạnh. Thank you for always supporting me whenever I need your

help and for all the knowledge and sharing you have taught me during my

university journey.

Additionally, I would like to express my profound gratitude to the Ho Chi

Minh University of Banking professors, who use their expertise and enthusiasm to

teach us priceless information.

Given the short amount of time available for the execution of the course, as

well as the limited expertise and knowledge, there will unavoidably be flaws. I

would appreciate any insightful feedback from teachers.

Last but not least, I would like to send my best wishes to the Ho Chi Minh

University of Banking's lecturers for continued good health and perseverance in

carrying out their grand goal of educating future generations.

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TABLE OF CONTENTS

LIST OF FIGURES ............................................................................................... vii

LIST OF TABLES ................................................................................................ viii

CHAPTER 1. INTRODUCTION ............................................................................1

1.1. Rationale of the study...................................................................................1

1.2. Research objectives......................................................................................3

1.3. Research questions.......................................................................................3

1.4. Scope of the study ........................................................................................3

1.5. Contribution of the study..............................................................................4

1.6. Research method ..........................................................................................4

1.7. Structure of the study ...................................................................................4

CONCLUSIONS OF CHAPTER 1 .........................................................................5

CHAPTER 2. LITERATURE REVIEW................................................................6

2.1. Theoretical framework .................................................................................6

2.1.1. Personal financial management behavior .............................................6

2.1.2. Factors affecting personal financial management behavior .................7

2.2. Empirical review ........................................................................................16

2.2.1. Domestic studies.................................................................................16

2.2.2. Foreign studies....................................................................................16

CONCLUSIONS OF CHAPTER 2 .......................................................................18

CHAPTER 3. RESEARCH METHODS AND DATA ........................................19

3.1. Research model and research hypotheses ..................................................19

3.2. Research data..............................................................................................19

3.3. Research methods.......................................................................................20

3.3.1. Cronbach's Alpha coefficient..............................................................20

3.3.2. Exploratory Factor Analysis (EFA)....................................................21

3.3.3. Pearson correlation..............................................................................23

3.3.4. OLS linear regression model ..............................................................24

CONCLUSIONS OF CHAPTER 3 .......................................................................27

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CHAPTER 4. RESEARCH RESULTS AND DISCUSSION .............................28

4.1. Descriptive statistics...................................................................................28

4.2. Checking the reliability of the scale...........................................................31

4.3. Exploratory factor analysis.........................................................................38

4.3.1. Independent variables .........................................................................38

4.3.2. Dependent variable .............................................................................45

4.4. Correlation analysis....................................................................................46

4.5. Regression model .......................................................................................48

CONCLUSIONS OF CHAPTER 4 .......................................................................55

CHAPTER 5. CONCLUSIONS AND RECOMMENDATIONS .......................56

5.1. Conclusions................................................................................................56

5.2. Recommendations......................................................................................57

5.3. Limitations and further research directions................................................58

CONCLUSIONS OF CHAPTER 5 .......................................................................59

REFERENCES........................................................................................................60

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LIST OF FIGURES

Figure 1.1. Covid-19 managing finances....................................................................2

Figure 2.1. The four factors of financial well-being.................................................11

Figure 2.2. What influences financial well-being.....................................................12

Figure 3.1. Research models.....................................................................................19

Figure 3.2. The scatter plot shows the relationship between the independent and

dependent variables...................................................................................................26

Figure 4.1. Age groups of survey participants..........................................................28

Figure 4.2. Marital status of survey participants.......................................................29

Figure 4.3. Histogram of residual values..................................................................52

Figure 4.4. Normal P-P Plot of Regression Standardized Residual..........................53

Figure 4.5. Scatter Plot..............................................................................................54