financing proposal

8/22/2019 financing proposal

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Factors That Influencing Personal Financial Planning Management: A Study At Kota Bharu

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CHAPTER 1 : INTRODUCTION

1.1 BACKGROUND OF STUDY

1.1.1 Overview on the factors that influencing personal finance planning

management.

Personal financial can be defined as a principle that teaches an individual how

to manage their money and monetary decisions into appropriate manner.

Individuals deal with financial management on a daily basis, and whether it is

budgeting for groceries, buying clothing, purchasing a home or car, or paying

for college, many of the financial decisions people make today can have

residual effects that last a lifetime. A bad credit score can lead to a higher

mortgage interest rate, which can lead to less purchasing power when buying

a home and paying thousands more in interest during the life of the mortgage.

Learning to manage money wisely is a challenging task for many, even more

so for individuals who lack basic financial skills and who have little to no

experience with financial management.

Personal finance is the application of the principles of finance to the

monetary decisions of an individual or family unit. It addresses the ways in

which individuals or families obtain, budget, save, and spend monetary

resources over time, taking into account various financial risks and future life

events. Components of personal finance might include savings accounts,

credit cards and consumer loans, retirement planning, investments and

insurance policies and income tax management. The personal financial

planning process enables to understand a financial plan and develop a

personal financial plan. The simple objective of financial planning is to make

the best use of the resources to achieve financial goals.
http://en.wikipedia.org/wiki/Financehttp://en.wikipedia.org/wiki/Personal_budgethttp://en.wikipedia.org/wiki/Savings_accounthttp://en.wikipedia.org/wiki/Credit_cardhttp://en.wikipedia.org/wiki/Loanhttp://en.wikipedia.org/wiki/Insurancehttp://en.wikipedia.org/wiki/Insurancehttp://en.wikipedia.org/wiki/Loanhttp://en.wikipedia.org/wiki/Credit_cardhttp://en.wikipedia.org/wiki/Savings_accounthttp://en.wikipedia.org/wiki/Personal_budgethttp://en.wikipedia.org/wiki/Finance


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The first factor influence personal financial planning is gender.

Females have often been found to possess less financial knowledge and

interests compared to males. Females are intrinsically right brain thinkers

which serve them better in nurturing roles as wives, mothers and

homemakers rather than financial matters. Despite being responsive to

financial education, females were found to possess a lower retirement age

and income goals. Females also tend to be risk adverse in financial choices.

Women know less about financial management than men. In

comparison to men, women share a larger burden of raising families, start to

work later and earn less during their careers, live longer, have inadequate

pension or survivors' benefits, and face more challenges in financial

management. Risk adverse behaviour of women in their retirement planning

will likely result in significantly lower pension wealth than men.

Second factor that influence personal financial planning is age.

Generally, older individuals are more conservative and risk adverse. The

deeper life experiences may encourage the acquisition of skills to secure their

financial aspirations in their life. Nowadays, youth prefer to use credit cards

which is can cause them to become bankruptcies in early ages. Low financial

knowledge may leading to high level debts, risk of bankruptcy and lacking

retirement planning skills among youth. Age can influence personal financial

planning management among people.

Third, factor that can influence personal financial planning

management is personal income. Personal income can influence people by

different level of income that different people monthly. It is also linked with

age. Typically, people with low incomes fall into the very young or very old

age groups. Tax management is important in order to avoid loss in their


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income. Sources of income which can be taxed includes gains and profits

from trade, profession and business, salaries, remunerations, gains and

profits from an employment, dividends, interests or discounts, rents, royalties

or premiums, pensions, annuities and others.

Fourth, another factor that can influence personal financial planning

management is level of education. Level of formal education is a controllable

factor that significantly affects the income. More high education tends to get

great earning in their life. Less knowledgeable investors are more prone to

hold a widely diversified asset portfolio, financial knowledge has also been

found to positively reinforce financial satisfaction. Financial literacy improves

the exposure and understanding of the risks associated with the complexity of

retirement, insurance and investment planning. Thus, higher education levels

are expect to be associated with higher financial awareness among people.

Fifth, investments planning also can influence people in their personal

financial planning. Investment planning is the part of financial planning that

pertains to the allocation of investment assets. There are a variety of different

types of investments available today, which are short-term investments, long-

term investments, and as many different investment strategies as there are

investors. Obviously, there are differences between short-term and long-term

investments. Short-term investments are designed to be made only for a little

while, and hopefully show a significant yield, for examples shares, insurance,

securities bought and others. Long-term investments are designed to last for

years, showing a slow but steady increase so that there is a significant yield at

the end of the term for example bonds, gold, long term notes, and others.


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Sometimes the individual have failed to make a successful financial

planning. Most of the time, they cannot balance between the saving,

expenses and investment portion. A key component of personal finance is

financial planning process and it has six major steps, which are define

financial goals, develop financial plans and strategies to achieve goals,

implement financial plans and strategies, periodically develop and implement

budgets to monitor and control progress towards goals, use financial

statements to evaluate results of plans and budgets by taking corrective

action, redefine goals and revise plans and strategies.


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1.2 PROBLEM STATEMENT

Todays financial world is highly complex when compared with that of a

generation ago. Several past years, a simple understanding about saving,

budgeting, retirement plan, investment and others thing about personal

finance may have been sufficient. Now, consumers must be able to make a

good saving, plan for their family futures to make sure that they are financially

prepared when they retire, lost their job or something emergency happen.

People also need to understand about personal finance because nowadays

there are many finance products and services. So to make sure that people

do not choose the wrong finance products and services, they need to

understand the basic about personal finance. So that they only can choose

the products and services that only give benefit to them.

Everyone has heard about making a decision about what to buy,

making a credit purchase and also use credit card every day but no one really

understands the full impact of their decisions. For example, people that

cannot manage their financial or cannot pay their overspending credit card bill

and also fail to pay their loan monthly payment may entering into the debt trap

and then may charge with personal bankruptcy. Sometimes people may

choose short cut by borrow the money from the loan shark. Then they need to

pay high interest and if they fail to the money, they will be blackmail and it

becomes a criminal and their life feel uncomfortable because of always

disturbing by the loan shark.

Financial planning is important because a fast-paced world an ever-

increasing number of financial alternatives are presented. Moreover,

information through all kinds of media, including the Internet is available to

help people to make selection which make wise decision can help people to


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achieve their goals. Financial planning also includes gaining insight into the

efficient way to perform a task and then handling it in a logical, disciplined

way, enables to further the objectives. Understanding personal financial

planning and being comfortable with own planning efforts have important

benefits for society as well. It allow people dedicate full efforts at work to the

job at hand. It also make people more effective at that job since the household

and the business approach many problems in the same way, and, many

personal financial planning techniques are useful in work-related situations.

Based on this nowadays situation, so, this study focuses on the factors

that influencing personal financial planning management with age, gender,

personal income, level of education and investment among the people at Kota

Bharu, Kelantan.


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1.3 OBJECTIVE THE STUDY

The main objective is to identify if there are any relationships between age,

gender, personal income, level of education and investment planning towards

the factors of influencing personal financial planning management.

In order to achieve the main factor, this research will specifically:

1.3.1 To identify that early age of people at Kota Bharu are more concern

about personal financial planning management.

1.3.2 To identify which gender are more concern about personal financial

planning management matter.

1.3.3 To identify level of income can influence personal financial planning

management.

1.3.4 To identify the level of education can influence personal financial

planning management.

1.3.5 To indentify the pattern about investment planning among people at

Kota Bharu.

.


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1.4 RESEARCH QUESTIONS

To investigate the four areas of concern, the following research questions

guided the study:

1.4.1 Does ages influence the personal financial planning management?

1.4.2 Does gender influence the personal financial planning management?

1.4.3 Does personal income influence the personal financial planning

management?

1.4.4 Does level of education influence the personal financial planning

management?

1.4.5 Does investment planning influence the personal financial planning

management?


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1.5 THEORETICAL FRAMEWORK

INDEPENDENT VARIABLES DEPENDENT VARIABLE

Factor personal financial planning can be influenced by gender, because it has

differences in level of awareness about personal finance management between

female and male. For the age, there are differences in the younger and adult level of

awareness towards personal finance management. It is whether young or adult is

more aware about personal finance management. For the personal income, people

get different incomes either lower income or higher income. So the factor towards

personal finance management is influenced by the personal income. For the level of

education, people with higher education may have a difference in their level of

awareness towards personal finance management. Investment planning also

becomes factor of personal financial planning management which the amounts that

people invest for their investments influence their personal financial planning

management.

PERSONAL FINANCIAL

PLANNING MANAGEMENT

GENDER

PERSONAL INCOME

LEVEL OF EDUCATION

AGE

INVESTMENT PLANNING


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1.6 RESEARCH HYPOTHESIS

The hypothesis of the study is:

Hypothesis I

Ho : There is no relationship between age and factor influencing personal finance

management.

H1 : There is a relationship between age and factor influencing personal finance

management.

Hypothesis II

Ho : There is no relationship between gender and factor influencing personal finance

management.

H1 : There is a relationship between gender and factor influencing personal finance

management.

Hypothesis III

Ho : There is no relationship between personal income and factor influencing personal

finance management.

H1 : There is a relationship between personal income and factor influencing personal

finance management.


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Hypothesis IV

Ho : There is no relationship between level of education and factor influencing

personal finance management.

H1 : There is a relationship between level of education and factor influencing personal

finance management.

Hypothesis V

Ho : There is no relationship between investment planning and factor influencing


H1 : There is a relationship between investment planning and factor influencing



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1.7 SIGNIFICANCE OF THE STUDY

This study is expected to be contributed significantly on the following aspects:

1.7.1 Consumers

The benefits can be in terms of more understanding about investment

planning and learn how to plan their financial wisely. They can start to

control their spending after this study and this will help them to use

money for necessary things. Thus, they are able to save their money or

make the good investment for emergency situations in the future.

Therefore, when they understand about personal finance, it will reduce

the burden of the consumers in the future.

1.7.2 Researcher

This research will give the researcher information about the personal

financial behaviour among people at Kota Bharu. From this, the

researcher know the age, gender, personal income, level of education

and investment planning can influence personal financial planning

pattern among people at Kota Bharu.

1.7.3 Government

From this study the government can know who understand and do not

understand about personal finance management, so that the

government may pay attention to make a personal finance campaign for

the focus group based on this study. Then the campaign that the

government does may be useful because it is done to the right focus

group. It also can avoid from wasting time, money and energy because

of false focus group.


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1.7.4 Workers

By using this study, it helps working people in order to manage and plan

their financial. Nowadays, most of them are aware of personal finance

but they do not know how to manage it. By doing this research, it could

help them to manage their personal finance wisely by make investment

wisely. They also can decide which level of age that they should start to

make the best action for their retirement soon.

1.7.5 Bankers

Bankers can use this study as a part of their marketing effort. From this

study they know which area is familiar with the respondent, so that they

can use the information to do marketing to the respondent. It also will

ensure that they do not waste their time and money to market their

financial product to those who do not know about their financial product.


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1.8 SCOPE OF STUDY

This study is about the factors influencing personal financial planning

management, at Kota Bharu that represents the urban area at Kelantan. This

study will investigate which factors is more influence about the personal

financial planning management. The respondents of this research are workers

in public sectors, private sectors, unemployed and self-employed that come

from Kota Bharu, Kelantan. The area of observation are at KB Mall, Pejabat

Setiausaha Negeri Kelantan, and UiTM Kota Bharu which participated about

100 respondents.


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1.9 LIMITATIONS OF THE STUDY

1.9.1 Budget constraint.

In doing the research, it will incur the researcher many costs.

Therefore, in doing the research, it is important for the researcher to

have a strong financial resource. This is because without financial

abilities, it will be difficult for the researcher to do and complete the

research efficiently and effectively. And with sufficient budget, it will

portray the transparencies.

1.9.2 Sources of information.

In order to do the research, information is the most important element

to be included. Without sufficient information, it will be hard for the

researcher to undergo the research. This is because the information

will help the researcher in obtaining findings and finally come out with

the solutions for the problems. It becomes constraint whenever the

researcher does get enough access for the information needed.

Besides that, for collecting information about peoples awareness

towards personal finance in Malaysia, the database for the information

is not properly recorded and stored. Furthermore, it is hard to be

found. Therefore, it is a problem for the researcher to get the

information. So, it will also affect the effort of the researcher in gaining

the information for the research.


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1.9.3 Timing constraints

Because this research will be done only in one semester only, we do

not have enough time to make a proper research. We only have about

5 months to complete this research. In order to complete this research

on time, we need to sacrifice much time to make sure the results for

this research are useful.

1.9.4 Cooperation constraints

Because this study uses the primary data, the researcher needs to

give the questionnaire to the respondent. But there are respondents

whose did not want to give their cooperation to the researcher.


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1.10 DEFINITION OF TERMS

1.10.1 Financial

A branch ofeconomics concerned with resource allocation as

well as resource management, acquisition and investment.

Simply, finance deals with matters related to money and the

markets.

1.10.2 Debt

The quantifiable likelihood of loss or less-than-expected

returns. Examples: currency risk, inflation risk, principal risk,

country risk, economic risk, mortgage risk, liquidity risk.

1.10.3 Loan

An arrangement in which a lendergives money orproperty to a

borrower, and the borrower agrees to return the property or

repay the money, usually along with interest, at some future

point(s) in time.

1.10.4 Risk

The quantifiable likelihood of loss or less-than-expected

returns. Examples: currency risk, inflation risk, principal risk,

country risk, economic risk, mortgage risk, liquidity risk
http://www.businessdictionary.com/definition/branch.htmlhttp://www.investorwords.com/1648/economics.htmlhttp://www.investorwords.com/4218/resource_allocation.htmlhttp://www.businessdictionary.com/definition/resource-management.htmlhttp://www.investorwords.com/80/acquisition.htmlhttp://www.investorwords.com/2599/investment.htmlhttp://www.investorwords.com/1299/deal.htmlhttp://www.businessdictionary.com/definition/matter.htmlhttp://www.investorwords.com/3100/money.htmlhttp://www.investorwords.com/2962/market.htmlhttp://www.investorwords.com/2896/loss.htmlhttp://www.investorwords.com/4244/return.htmlhttp://www.investorwords.com/1243/currency_risk.htmlhttp://www.investorwords.com/2457/inflation_risk.htmlhttp://www.investorwords.com/3843/principal_risk.htmlhttp://www.investorwords.com/1170/country_risk.htmlhttp://www.investorwords.com/1646/economic_risk.htmlhttp://www.investorwords.com/3144/mortgage_risk.htmlhttp://www.investorwords.com/2841/liquidity_risk.htmlhttp://www.businessdictionary.com/definition/arrangement.htmlhttp://www.investorwords.com/2767/lender.htmlhttp://www.investorwords.com/3100/money.htmlhttp://www.investorwords.com/3900/property.htmlhttp://www.businessdictionary.com/definition/borrower.htmlhttp://www.investorwords.com/4244/return.htmlhttp://www.investorwords.com/7199/repay.htmlhttp://www.investorwords.com/5331/with_interest.htmlhttp://www.businessdictionary.com/definition/point.htmlhttp://www.investorwords.com/2896/loss.htmlhttp://www.investorwords.com/4244/return.htmlhttp://www.investorwords.com/1243/currency_risk.htmlhttp://www.investorwords.com/2457/inflation_risk.htmlhttp://www.investorwords.com/3843/principal_risk.htmlhttp://www.investorwords.com/1170/country_risk.htmlhttp://www.investorwords.com/1646/economic_risk.htmlhttp://www.investorwords.com/3144/mortgage_risk.htmlhttp://www.investorwords.com/2841/liquidity_risk.htmlhttp://www.investorwords.com/2841/liquidity_risk.htmlhttp://www.investorwords.com/3144/mortgage_risk.htmlhttp://www.investorwords.com/1646/economic_risk.htmlhttp://www.investorwords.com/1170/country_risk.htmlhttp://www.investorwords.com/3843/principal_risk.htmlhttp://www.investorwords.com/2457/inflation_risk.htmlhttp://www.investorwords.com/1243/currency_risk.htmlhttp://www.investorwords.com/4244/return.htmlhttp://www.investorwords.com/2896/loss.htmlhttp://www.businessdictionary.com/definition/point.htmlhttp://www.investorwords.com/5331/with_interest.htmlhttp://www.investorwords.com/7199/repay.htmlhttp://www.investorwords.com/4244/return.htmlhttp://www.businessdictionary.com/definition/borrower.htmlhttp://www.investorwords.com/3900/property.htmlhttp://www.investorwords.com/3100/money.htmlhttp://www.investorwords.com/2767/lender.htmlhttp://www.businessdictionary.com/definition/arrangement.htmlhttp://www.investorwords.com/2841/liquidity_risk.htmlhttp://www.investorwords.com/3144/mortgage_risk.htmlhttp://www.investorwords.com/1646/economic_risk.htmlhttp://www.investorwords.com/1170/country_risk.htmlhttp://www.investorwords.com/3843/principal_risk.htmlhttp://www.investorwords.com/2457/inflation_risk.htmlhttp://www.investorwords.com/1243/currency_risk.htmlhttp://www.investorwords.com/4244/return.htmlhttp://www.investorwords.com/2896/loss.htmlhttp://www.investorwords.com/2962/market.htmlhttp://www.investorwords.com/3100/money.htmlhttp://www.businessdictionary.com/definition/matter.htmlhttp://www.investorwords.com/1299/deal.htmlhttp://www.investorwords.com/2599/investment.htmlhttp://www.investorwords.com/80/acquisition.htmlhttp://www.businessdictionary.com/definition/resource-management.htmlhttp://www.investorwords.com/4218/resource_allocation.htmlhttp://www.investorwords.com/1648/economics.htmlhttp://www.businessdictionary.com/definition/branch.html


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CHAPTER 2: LITERATURE REVIEW

2.1 INTRODUCTION

This part will discuss the literature review which is relevant to the study. It is

regarding the personal financial planning management among people at Kota

Bharu relationship with the age, gender, personal income, level of education

and investment planning of respondents.

2.2 PERSONAL FINANCIAL PLANNING

Personal financial planning is the process of planning spending, financing, and

investing to increase the profit and to optimize the financial situation. In order to

achieve the goals which to increase the worth, the proper financial plan are

intended by specifies the financial goals, describes the spending, financing,

investing plans. Lack of savings will cause many problems which can contribute

bankruptcy among youth, increasing cost of health care and other

necessities,(Jeff Madura,2007).

Besides, based on study by Lewis J. Altfest, 2007,personal financial

planning can be thought of as the analysis and decision making extension of

personal finance. Basically, personal financial planning decisions includes

consumption and savings, investments, financing, and risk management.

Personal finance is the application of the principles of finance to the

monetary decisions of an individual or family unit. It addresses the ways in

which individuals or families obtain, budget, save, and spend monetary

resources over time, taking into account various financial risks and future life

events. Components of personal finance might include checking and savings

accounts, credit cards and consumer loans, investments in the stock market,

retirement plans, social security benefits, insurance policies, and income tax

management.(http://en.wikipedia.org/wiki/Personal_finance)
http://en.wikipedia.org/wiki/Financehttp://en.wikipedia.org/wiki/Personal_budgethttp://en.wikipedia.org/wiki/Checking_accounthttp://en.wikipedia.org/wiki/Savings_accounthttp://en.wikipedia.org/wiki/Savings_accounthttp://en.wikipedia.org/wiki/Credit_cardhttp://en.wikipedia.org/wiki/Loanhttp://en.wikipedia.org/wiki/Stock_markethttp://en.wikipedia.org/wiki/Retirement_planhttp://en.wikipedia.org/wiki/Social_securityhttp://en.wikipedia.org/wiki/Insurancehttp://en.wikipedia.org/wiki/Income_taxhttp://en.wikipedia.org/wiki/Personal_financehttp://en.wikipedia.org/wiki/Personal_financehttp://en.wikipedia.org/wiki/Income_taxhttp://en.wikipedia.org/wiki/Insurancehttp://en.wikipedia.org/wiki/Social_securityhttp://en.wikipedia.org/wiki/Retirement_planhttp://en.wikipedia.org/wiki/Stock_markethttp://en.wikipedia.org/wiki/Loanhttp://en.wikipedia.org/wiki/Credit_cardhttp://en.wikipedia.org/wiki/Savings_accounthttp://en.wikipedia.org/wiki/Savings_accounthttp://en.wikipedia.org/wiki/Checking_accounthttp://en.wikipedia.org/wiki/Personal_budgethttp://en.wikipedia.org/wiki/Finance


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Based on journal by Ade`le Gritten,(2011), are mention about a

paradigm shift in consumer confidence has taken place with the worst

recession on record forcing people to evaluate their personal and household

finances This journal seeks to explore the extent to which consumer confidence

has been tarnished, and how it has evolved post-recession. It aims to take both

retrospective and prospective views on what has changed in the British psyche

since the credit crunch, looking at where new confidences have been found and

where old confidences have been lost. The methodology is based on a variety

of proprietary quantitative research surveys conducted by YouGov plc. The

findings is provides new insights into consumer confidence, looking at which

aspects of household expenditure and budgets have been hardest squeezed,

and what that means for short- and medium-term futures; analysing the extent

to which the generally lower level of available credit makes consumers more or

less reliant on borrowing as a way of life, and the associated impact on

confidence and decision making/financial planning prioritisation; exploring the

real fears and concerns people have about their future finances and exploring

consumer financial hopes and aspirations in a post-recessionary climate.

Based on journal by Ming Ming Lai And Wei Khong, (2009), mentioned

about the attitudes of the Malaysians toward personal financial planning, which

encompasses money management, insurance planning, investment planning,

retirement planning, and estate planning . the methodology use a survey data

was obtained from 400 Malaysians by using a set of structured questionnaire

associated personal financial planning efforts with three measures attitudes

towards personal financial planning, factors influencing various aspects of

personal financial planning decision, and frequency of managing for various

aspects of personal financial planning. The results show that the job status of a

respondent is the primary factor in influencing attitudes towards personal


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financial planning and the frequency in managing for various aspects of

personal financial planning. Demographic characteristics such as age, race,

marital status, gender, and education level are the secondary factors were

concerned. This journal has implications on financial planners in formulation

strategies on how to successfully deploy a personal financial planning

programme for their customers.

2.3 DEMOGRAPHIC FACTORS (AGE, GENDER, PERSONAL INCOME AND

LEVEL OF EDUCATION)

Based on study by Joyce K.H. Nga, Lisa H.L. Yong and Rathakrishnan D.

Sellapan, (2010),this journal are mention about investigate the level of general

financial and product awareness among young adults. This journal also state

that demographic factors have been found to influence consumer behaviour.

Besides, socioeconomic and cultural background also have impact on an

individual financial knowledge, perception risk, consumption and spending

patterns.The methodology use a survey was employed using a sample of 280

student at a private higher education institution in Subang Jaya, Malaysia.

Exploratory factor analysis (EFA) using principal component analysis (PCA)

was used to evaluate convergent and discriminates validity of the measures for

the constructs of this study, namely general financial awareness and financial

product awareness. Hypothesis testing was done using multivariate analysis of

variance (MANCOVA). The findings of the study revealed that the level of

education and majors influence general and financial product awareness

among youths. Also, males were found to have higher levels of financial

awareness compared to females.


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Based on study by David S. Murphy and Scott Yetmar,(2010) are

mention about to report on a survey about the personal financial planning

attitudes of MBA students in the USA. The methodology use The study

surveyed 206 MBA students about their attitudes to personal financial

planning. Participants were asked about their level of knowledge, whether

they had prepared components of a financial plan, where they might seek

assistance in such a process and the criteria for selecting a financial planner.

In addition, participants were asked to indicate their level of confidence in a

financial plans capacity to help them meet their long-term needs and the

likelihood that they would implement such a plan. The findings are indicate

that, while most respondents feel both that financial planning is important and

that they are interested in developing a financial plan, very few feel that they

have the necessary skills and knowledge to prepare their own plan. In

addition, the participants indicated a strong preference for professional

personal financial planning advice. The study also indicates that less than 13

percent have prepared a comprehensive personal financial plan. When asked

to identify the one professional from whom they would seek advice, certified

financial planners were the preferred resource.

Moreover, based on study by Chen, Haiyang,(2002),are journal

mention about surveying financial literacy among college students, find that

women generally have less knowledge about personal finance topics. Gender

differences remain statistically significant after controlling for other factors

such as participants' majors, class rank, work experience, and age. However,

that education and experience can have a significant impact on the financial

literacy of both men and women. Women generally have less enthusiasm for,

lower confidence in, and less willingness to learn about personal finance

topics than men do. Methodologythis study uses a comprehensive survey to


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determine participants' personal finance knowledge in the areas of general

knowledge of personal finance, savings and borrowing, insurance, and

investments. To cover the domain of the key areas of personal finance, it

have thoroughly reviewed related literature and generated hundreds of

questions in these areas. The findings are on average women know less

about personal finance than men.

2.4 INVESTMENT PLANNING FACTOR

According to Lewis J. Altfest,2007, Investment is the result of decision where

spend less today so that people will have enough wealth for future spending

needs. The reason of investment and saving is tp have enough money to live

comfortably in retirement when people no longer have active work-related

income. How much people put aside for investments depends on their goals

which are strongly influenced by the pleasure people get from spending today

versus the satisfaction people get from saving monies so that people live the

good life in the future.

Based on study by Tuan Hock Ng, Woan Ying Tay, Nya Ling Tan, and

Ying San Lim (2011), this journal mention about analyses the effect of

demographic and investment experience on retirement planning intention.

Recognising the importance of retirement planning, 300 structured

questionnaires were administered in April 2009. The final sample consists of

216 after the account for non-replied questionnaires and the removal of

incomplete data. Pertinently, Malaysia represents a unique platform for this

research due to its multiracial cultures. The methodology use a total of 300

questionnaires were personally administered in three states in Malaysia,

namely Johor, Melaka, and Selangor in April 2009. Only 250 respondents

attempted this survey. There were 50 questionnaires that were failed to be

collected from respondents. Of the total 250 responded questionnaires, 34


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copies were discarded due to incomplete data, making a sample of 216

copies in the present study or a total of 72 % response rate. SPSS version

16.0 was used to analyse all the data collected. The findings of this research

show that demographic characteristics affect behavioural intention, i.e. marital

status, age, and income level. Investment experience is another factor

reported to have significantly affected retirement planning intention in this

study.


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CHAPTER 3 : RESEARCH METHODOLOGY

3.1 INTRODUCTION

Research methodology refers to a description on data collection methods,

sampling design and statistical technique use for data analysis.

Methodology can be defined the analysis of the principles of methods,

rules, and postulates employed by a discipline or, the systematic study of

methods that are, can be, or have been applied within a discipline or, a

documented process for management of projects that contains procedures,

definitions and explanations of techniques used to collect, store, analyze and

present information as part of a research process in a given discipline.

(http://en.wikipedia.org/wiki/Methodology)

3.2 SAMPLING AND DATA COLLECTION

The sampling of data used is simple or convenience sampling. The population

for this study comprised of workers in public sector, private sector,

unemployed and self-employed around Kota Bharu. In this study, the primary

data was taken or used. The data were taken from 100 respondents from

Pejabat Setiausaha Kelantan, people at KB Mall and people at UiTM Kota

Bharu by giving them questionnaires that have been prepared. In this study,

the independent variables are gender, age, personal income, level of

education and investment planning.

The researcher used primary data to complete this study. Primary data

is the data collected or obtained directly from the field. The researcher had

developed questionnaires that had been distributed at the fieldwork that is

worker in government sector, private sector, unemployed and self-employed

around Kota Bharu.
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3.3 SAMPLE AND SAMPLING DESIGN

The structured questionnaire is used in gathering data for completion of this

study. For this study, the question is divided into three different parts. Part A is

on demographic profile that consists of multiple choice questions about

demographic information and introduction about personal finance

management. This demographic factor is the independent variable for this

study.

Meanwhile, in Part B the researcher had constructed questions about

public awareness and how respondents manage personal financial planning.

In part B the questions include concerning, budgets, expenditure, expenses

and investment planning and the others that are related to personal finance

management. In this part the researcher will use the multiple choice question.

Last part is Part C, the researcher constructed question about public

opinion which to know what opinion people towards the personal financial

planning management. In this part the researcher will use the Likert Scale

question.

3.3.1 Multiple Choice Questions

The multiple choice question is single coded in which the respondent

is permitted to check one and only one answer.

3.3.2 Likert Scale Questions

This scaling technique required the respondents to indicate a degree

of agreement or disagreement with each series of statements. There

are five different scale used to differentiate the degree of agreement

and disagreement. The scales ranges 1 to 5 from strongly disagree to

strongly agree, respectively.


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3.4 DATA ANALYSIS

For the measurement of the data, the Statistical Package for the Social

Sciences (SPSS) packages are used. It is to determine the relationship

among the variables. Besides that, the SPSS is used to build the regression

equation that can be derived from the production of rice. The data and

findings then will be assessed to determine the correlation among the

variables.

3.4.1 Descriptive statistics

Descriptive statistics are useful to describe the data or to see the

characteristics of the data. It will describe the demographic data from

the research. From the descriptive statistic we may know the

respondent age, gender, personal income, level of education and race.

3.4.2 Crosstab

In order to explained the relationship between variable, crosstab are

used. Cross tabulation is the process of creating a contingency table

from the multivariate frequency distribution of statistical variables.

Heavily used in survey research, cross tabulations (or crosstabs for

short) can be produced by a range of statistical packages, including

some that are specialized for the task. Survey weights often need to

be incorporated. Unweighted tables can be easily produced by some

spreadsheets and other business intelligence tools, where they are

commonly known as pivot tables.
http://en.wikipedia.org/wiki/Contingency_tablehttp://en.wikipedia.org/wiki/Frequency_distributionhttp://en.wikipedia.org/wiki/Statisticshttp://en.wikipedia.org/wiki/Spreadsheethttp://en.wikipedia.org/wiki/Business_intelligence_toolshttp://en.wikipedia.org/wiki/Pivot_tablehttp://en.wikipedia.org/wiki/Pivot_tablehttp://en.wikipedia.org/wiki/Business_intelligence_toolshttp://en.wikipedia.org/wiki/Spreadsheethttp://en.wikipedia.org/wiki/Statisticshttp://en.wikipedia.org/wiki/Frequency_distributionhttp://en.wikipedia.org/wiki/Contingency_table


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3.5 REGRESSION TECHNIQUE

Regression analysis is concerned with the study of the dependence of one

variable, the dependent variable, on one or more other variables, the

independent variables, with a view to estimating and predicting the

(population) mean or average value of the former in terms of the known or

fixed values of the latter. In others word, regression analysis is statistical

technique for investigating and modelling the relationship between variables.

Its explain how a dependent variable is affected by independent variables.

3.5.1 ANOVA

Analysis of Variance (ANOVA) models is a regression that may

contain regressors that are all exclusively dummy, or qualitative in

nature (Gujerati and Porter,2009). Use this model if all independent

variables are qualitative or dummy variables.

ANOVA purposes are to assess the statistical significance of the

relationship between a quantitative regress and (Y) and qualitative or

dummy variables. Moreover, ANOVA use to compare differences in

the mean values of 2 or more groups or categories.

3.5.2 MULTIPLE REGRESSION ANALYSIS

In two-variable regression there is only one independent variable,

whereas in multiple regression there is more than one independent

variable. The true model contains the random error term and the true

coefficients for the input variables.

Y = 0 + 1X+

Y = parameter0 = intercept1 = Slope coefficientX = independent variable

= error term


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3.5.3 COEFFICIENT CORRELATION, R

Coefficient Correlation, R, is a quantity closely related to but

conceptually very much different from r2. The quantity r, called the

linear correlation coefficient, measures the strength and the direction

of a linear relationship between two variables. The value of r is such

that -1 r 1. The + and signs are used for the positive linear

correlations and negative linear correlations.

3.5.4 COEFFICIENT DETERMINATION, R2

Coefficient Determination, R2

, is a summary measure that telss how

well the sample regression line fits the data. This R2 lies between 0

and 1, the closer it is to 1, the better is the fit.

3.5.5 T-TEST

T-test is a test of significance is a procedure by which sample results

are used to verify the truth or falsity of a null hypothesis.

- If t-test > t-table = the variable is significant

- If t-test < t-table = the variable is not significant

3.5.6 F-TEST

The F-test is used for comparisons of the components of the total

deviation. For example, in one-way, or single-factor ANOVA, statistical

significance is tested for by comparing the F test statistic.
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3.5.7 THE DURBINWATSON STATISTIC

This is a test statistic used to detect the presence ofautocorrelation in

the residuals from a regression analysis. To indicate DurbinWatsonstatistic good or not, check the value of DurbinWatson. If the value

below than 1.5 and greater than 2.5 show that have Durbin-Watson

problem or autocorrelation. Good Durbin-Watson statistic value

between 1.5 - 2.5.
http://www.answers.com/topic/test-statistic-1http://www.answers.com/topic/autocorrelation-1http://www.answers.com/topic/errors-and-residuals-in-statisticshttp://www.answers.com/topic/regression-analysishttp://www.answers.com/topic/regression-analysishttp://www.answers.com/topic/errors-and-residuals-in-statisticshttp://www.answers.com/topic/autocorrelation-1http://www.answers.com/topic/test-statistic-1


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CHAPTER 4 : FINDINGS AND INTERPRETATION OF DATA

4.1 INTRODUCTION

Based on this research, the researcher had interpreted the data and findings

by using the tables and pie charts. All of these outputs come out from the

data that the researcher had gathered from the respondents that work in the

three different sectors which are public sector, private sector and self-

employed. The respondents come from Kota Bharu.

In this chapter, analysis can be divided into two which are

descriptive analysis and regression analysis. Descriptive include the

demographic matters such as age, gender, personal income, level of

education, race, marital status and others. Regression analysis is the

explanation about the output which consist of ANOVA table, F-test, T-test and

others which to see the correlation between variables.


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4.2 DESCRIPTIVE ANALYSIS

PART A : DEMOGRAPHIC

Respondents gender

Figure 4.1: Respondents Gender

From the Figure 4.1, it shows the number of people that live in Kota Bharu. It shows

that female respondents are higher with 53.0% than the male respondents with

47.0%. The gap between female respondents and male respondents is 6.0% which is

due to the reason that many females rather than males.

femalemale

gender

60

50

40

30

20

10

0

Percent

53.0%

47.0%

gender


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Respondents race

Figure 4.2: Respondents Race

From the figure 4.2, respondents can be divided into 4 races, which Malays with

98.0%, followed by Chinese with 0.0%, third is Indians with 0.0% and the last

proportion is others with 2.0%.

othersmalay

race

100

80

60

40

20

0

Percent

2.0%

98.0%

race


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Respondents Age

Figure 4.3: Respondents Age

From the Figure 4.3, respondents age has been diversified into five groups. These

are 20 years old and below, 21 to 30 years old, 31 to 40 years old, 41 to 50 years old,

51 and above. It shows that the majority of the respondents that participated in this

study range from 21 to 30 years old groups. This age of group dominated 62.0%. It is

followed by respondents who are aged around 21 to 30 years old with 28.0%, then 20

years old and below with 5.0%, then 41 to 50 years old with 4.0% and the last group

is in the range 51 years old and above with percentage of 1.0%.

51 above41-5031-4021-30below 20

age

60

40

20

0

Percent

1.0%

4.0%

28.0%

62.0%

5.0%

age


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Respondents Marital Satus

Figure 4.4: Respondents Marital status

From the figure 4.4, respondents can be divided into 2 status of marriage, which

single and marriage. The bar chart shows that single with 52.0%, followed by married

with 48.0%.

marriedsingle

marital status

60

50

40

30

20

10

0

Percent

48.0%

52.0%

marital status


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Respondents Level of Education

Figure 4.5: Respondents Level of Education

Figure 4.5 shows the respondents education level which is divided by five gropus

SPM/STPM, Diploma, Bachelor, Postgraduate and others . The majority of the

respondents are Bachelor with 48.0%, then Diploma holders with 48.0%, followed by

SPM/STPM holders 24.0%, then postgraduate 1.0% and the minority group is others

with 0.0%. Figure 4.2.1.6 shows the respondents education level which is divided by

four gropus SPM, STPM, Diploma and Degree. The majority of the respondents are

Degree holders with 35.9%, then SPM holders with 35.2%, followed by Diploma

holders 15.2% and the minority group is STPM holders with 13.7%.

postgraduatebachelordiplomaspm/stpm

education

50

40

30

20

10

0

Percent

1.0%

48.0%

27.0%

24.0%

level of education


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Respondents Working Sector

Figure 4.6: Respondents Working Sector

From figure 4.6, respondent have been diversified into four groups which are public

sector, private sector, self-employed and unemployed. It shows that majority of the

respondent are from the public sector which is 60.0%, followed by respondents from

unemployed 29.0%, then self-employed 8.0% and the last group of respondents from

private sector 3.0%.

unemployedself-employedprivatepublic

working sector

60

50

40

30

20

10

0

Percent

29.0%

8.0%

3.0%

60.0%

working sector


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Respondents Personal income

Figure 4.7: Respondents Personal income

Figures 4.7, represents the result of descriptive statistic and percentage of the

respondents income level. It shows that there are 34 respondents who earned RM

1000 and below per month with 34.0 %. This is followed by 29 of the respondents

who earned an income ranging from RM 1001 to RM 2000 with 29.0 %. Then 18

respondents for both range of income between RM 2001 and RM 3000 and income

between RM 3001 and RM4000 with the percentage of both income level is 18.0%.

Last is only one person who is income in range of RM4001-RM5000.

RM4001-RM5000RM3001-RM4000RM2001-RM3000RM1001-RM2000below RM1000

personal income

40

30

20

10

0

Percent

1.0%

18.0%18.0%

29.0%

34.0%

Personal Income


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PART B : PUBLIC AWARENESS

CROSSTAB

Public Awareness Towards Variables

GENDER

No. QUESTION MALE FEMALE

YES NO YES NO

1. Do you concern about your personal financial planning? 45 2 49 4

2. Do you think, monthly budgets are necessary? 45 2 53 0

3. Do you always make a monthly personal financialplanning budget?

41 6 44 9

4. Do you follow your monthly budget? 39 8 31 22

5. A person makes expenditure in everyday. Do you oftenconsider whether the real necessity before you make apurchase in your expenditure?

37 10 41 12

6. Do you think electronic payments (e.g. credit cards,debit cards) encourage you to spend more?

24 23 33 20

7. Do you make financial planning for the future? 43 4 44 9

8. How much your expenditure per month? MALE FEMALE

a) Less RM300 7 25

b) RM301-RM600 15 17

c) RM601-RM900 12 6

d) RM901 and above 13 5

9. Do Have Made An Investment

MALE FEMALE

YES NO YES NO40 7 34 19

10. Where do you invest your money?

a) Golds 3 2

b) Properties 2 0

c) Unit Trusts 26 21

d) Mutual Funds 2 3

e) Tabung Haji 6 9

11. How much do you invest your money per year? MALE FEMALE

a) Less than RM300 6 18

b) RM301-RM600 12 8c) RM601-RM900 12 4


12. I start make investment from..... MALE FEMALE

a) 10 yrs old and below 4 4

b) 11-20 yrs old 8 12

c) 21-30 yrs old 22 13

d) 31-40 yrs old 4 1

e) 41 yrs old and above 1 5

13. What are the factors that influence your investment? MALE FEMALE

a) Spending Pattern 9 2

b) Attitude 4 1

c) Awareness 22 23d) Parental Guidance 4 9Table 4.1: Respondents Public Awareness towards Gender


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The table 4.1 shows that correlation between public awareness with gender. From

the table female are more concern about the financial planning management, so they

think budgets are necessary. Overall female are more aware about the knowledge of

personal financial planning. In term of investment planning, male are dominant to

make investment planning.

AGE

No. QUESTION TEENAGER ADULT

YES NO YES NO

1. Do you concern about your personal financialplanning?

5 0 85 0



4 1 81 14


5. A person makes expenditure in everyday. Do youoften consider whether the real necessity before youmake a purchase in your expenditure?

4 1 74 21


3 2 54 41


8. How much your expenditure per month? TEENAGER ADULT

a) Less RM300 2 30

b) RM301-RM600 3 29

c) RM601-RM900 0 18



TEENAGER ADULT

YES NO YES NO4 1 70 25


a) Golds 0 5

b) Properties 0 2

c) Unit Trusts 2 45

d) Mutual Funds 0 5

e) Tabung Haji 2 13


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Table 4.2: Respondents Public Awareness towards Age

Table.4.2 shows that correlation between age and respondents public awareness.

Teenager are classify as below of 20 years old where adult is classify 21 and above.

Most of adult knows the knowledge about financial planning and the benefit of that.

They can manage well when their age at 20 and above. In term of investment most

adult start their investment at 20 years old and above. it is because of their

awareness themselves.

INCOME

No. QUESTION LOWINCOME

HIGHINCOME

YES NO YES NO

1. Do you concern about your personal financialplanning?

30 4 64 2



24 10 61 5


5. A person makes expenditure in everyday. Do youoften consider whether the real necessity before youmake a purchase in your expenditure?

26 8 36 30


21 13 36 30


11. How much do you invest your money per year? TEENAGER ADULT


b) RM301-RM600 0 20

c) RM601-RM900 0 16


12. I start make investment from..... TEENAGER ADULT


b) 11-20 yrs old 1 19

c) 21-30 yrs old 3 32

d) 31-40 yrs old 0 5


13. What are the factors that influence your investment? TEENAGER ADULT


b) Attitude 0 5

c) Awareness 3 42

d) Parental Guidance 1 12


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LOWINCOME

HIGHINCOME

YES NO YES NO

21 13 53 14


a) Golds 2 3

b) Properties 0 2


d) Mutual Funds 0 5e) Tabung Haji 5 10

11. How much do you invest your money per year?LOW

INCOMEHIGH

INCOME


b) RM301-RM600 6 14

c) RM601-RM900 4 12


12. I start make investment from..... LOWINCOME

HIGHINCOME

a) 10 yrs old and below 4 4b) 11-20 yrs old 8 12

c) 21-30 yrs old 8 27

d) 31-40 yrs old 1 4


13. What are the factors that influence your investment? LOWINCOME

HIGHINCOME


b) Attitude 1 4

c) Awareness 13 32


Table 4.3: Respondents Public Awareness towards Income

Table 4.3 shows that correlation of income and public awareness among

respondents. Below than RM1000 consider as low income where RM1001 and above

consider as high income. Mostly high income aremore concern about the personal

financial planning. They make investment more in unit trust followed by tabung haji.

8. How much your expenditure per month? LOWINCOME

HIGHINCOME

a) Less RM300 19 13

b) RM301-RM600 15 17

c) RM601-RM900 0 18



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LEVEL OF EDUCATION

No. QUESTION LOW LEVELEDUCATION

HIGH LEVELEDUCATION

YES NO YES NO

1. Do you concern about your personalfinancial planning?

22 2 72 4

2. Do you think, monthly budgets arenecessary?

23 1 75 1

3. Do you always make a monthly personalfinancial planning budget?

20 4 65 11


5. A person makes expenditure in everyday.Do you often consider whether the realnecessity before you make a purchase inyour expenditure?

19 5 59 17

6. Do you think electronic payments (e.g.

credit cards, debit cards) encourage you tospend more?

12 12 45 31

7. Do you make financial planning for thefuture?

21 3 66 10

8. How much your expenditure per month? LOW LEVELEDUCATION

HIGHLEVEL

EDUCATION

a) Less RM300 4 28

b) RM301-RM600 7 25

c) RM601-RM900 5 13



LOW LEVELEDUCATION

HIGHLEVEL

EDUCATION

YES NO YES NO

18 6 56 20


a) Golds 0 5

b) Properties 1 1


d) Mutual Funds 1 4

e) Tabung Haji 4 11


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11. How much do you invest your money per year?LOW LEVELEDUCATION

HIGHLEVEL

EDUCATION


b) RM301-RM600 6 14

c) RM601-RM900 4 12


12. I start make investment from..... LOW LEVELEDUCATION

HIGHLEVEL

EDUCATION


b) 11-20 yrs old 3 17

c) 21-30 yrs old 8 27

d) 31-40 yrs old 5 0


13. What are the factors that influence yourinvestment?

LOW LEVELEDUCATION

HIGHLEVEL

EDUCATION


b) Attitude 1 4

c) Awareness 13 32


Table 4.4: Respondents Public Awareness towards Education Level

Table 4.4 shows that the correlation between public awareness towards education

level. More high level of their education tend them to make better investment. It is

because the knowledge that get is useful for them to manage their personal financial

planning. Financial management will become advantage for the respondents to

manage their money and debt wisely so that the bankruptcy among youth will reduce

effectively.


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PART C : PUBLIC OPINION

NO. QUESTIONS MEAN STANDARD

DEVIATION

C21. I know about personal financial planningmanagement. 2.8300 0.66750

C22.I know about the important of personal financial

planning management. 2.9300 0.60728

C23.Investment planning should start from early of

age. 3.2600 0.77355

C24.

Females have often been found to posses less

financial knowledge and interests compared to

males.

1.9200 1.19494

C25.High monthly personal income tends people less

in personal financial planning.

2.4700 1.04886

C26.High level of education tends people better in

their personal financial planning.

2.7900 0.93523

Table 4.5: Respondents Public Opinion

Strongly disagree Disagree Moderate Agree Strongly Agree

1 2 3 4 5

The table shows that respondents know about personal financial planning although

not too much, the mean close to moderate opinion. Respondents also close

moderate opinion agrees that financial planning should start from early of age.

Moreover, respondents disagree that female have been found to posses less

financial knowledge and interest compared male. Then, respondents disagree that

high monthly personal income will tends people less in personal financial planning.

Most respondent also disagree that high level of education tends people better in

their personal financial planning. Overall means that theres all respondents opinion

give figure almost of 3 which mean moderate opinion.


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4.3 REGRESSION ANALYSIS

In regression analysis the dependent variable, or regressand, is frequently

influenced not only by ratio scale variables for example income, output,

prices, costs, but also variables that are essentially qualitative or nominal

scale such as sex, race , colour, religion, nationality. One way could quantify

such attributes is by constructing artificial variables that take on values of 1 or

0, 1 indicating the presence of that attribute and 0 indicating the absence of

that attribute.

Dummy variable are variable that assume 0 and 1 value to classify

data into categories such as male and female, age, gender, income,

education and others.

Model Equation :

Y = 0 + 1D1- 2D2+ 3D3- 4D4+ 5X5+

PFP= 0+ 1AGE-2GENDER+3INCOME-4EDUCATION+5INVESTMENT

PLANNING+

PFP = 0.315+ 0.431 (AGE) - 0.134 (GENDER) + 0.458 (INCOME) -

0.174 (EDUCATION) + 0.213 (INVESTMENT PLANNING) +

Where indicated:

PFP =Personal Financial Planning

AGE D1 = 0- teenagers

D1 = 1- adults

GENDER D2 = 0-male

D2 = 1-female

INCOME D3= 0-Low level income

D3 = 1-High level income

EDUCATION D4= 0-Low level of education

D4 = 1-High level of education


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INTERPRETATION:

a) Age = When 1% increase in age, will effect to personal financial planning

management increase by 0.413%

b) Gender= When 1 person increase in gender, will effect to personal financial

planning management decrease by 0.134%

c) Income = When RM1 increase in income, will effect to personal financial

planning management increase by 0.458%

d) Education=When 1% increase in education, will effect to personal financial

planning management decrease by 0.174%

e) Investment planning = When 1% increase in investment planning, will effect

to personal financial planning management increase by 0.213%

4.4 TEST SIGNIFINCANCE

In test significance procedure, one develops a test statistic and examines its

sampling distribution under the null hypothesis. The test statistic usually

follows a well-defined probability distribution such as the normal, t, F, or chi-

square. Once a test statistic (t-statistic) is computed from the data at hand, its

p value can be easily obtained. The p value gives the exact probability of

obtaining the estimated test statistic under the null hypothesis. Ifp value is

small, one can reject the null hypothesis, but if it is large one may not reject it.

4.4.1 The t-test

T-test is a test of significance is a procedure by which sample results

are used to verify the truth or falsity of a null hypothesis.

- If t-test > t-table = the variable is significant

- If t-test < t-table = the variable is not significant

t-test = n-k-1

df=94 t-table at 0.05%= 1.658


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NO. VARIABLES Beta/(t-test)

1. CONSTANT (PERSONAL FINANCIAL PLANNING) 0.315

2. AGE 0.431

(3.053)*

3. GENDER -0.134

(-0.687)

4. PERSONAL INCOME 0.458

(5.060)*

5. LEVEL OF EDUCATION -0.174

(-1.706)*

6. B16: INVESTMENT PLANNING 0.213(1.037)

*( ) t-test significant at 0.05%, Reject H0

Table 4.6 : T-test Result

4.4.2 The F-test

F-test is used for comparisons of the components of the total

deviation. For example, in one-way, or single-factor ANOVA, statistical

significance is tested for by comparing the F test statistic.

F-test =15.365

F = R2 / (k-1)(1-R2)/9n-k)

F-table = 8.62 at 0.05 level of significance

F-test > F-table

15.365 > 8.62 significant for the overall model

Which means 15.37% highly significant. All five independent variables

(age, gender, income, personal income, level education and

investment planning) highly become factor for the dependent variable,

personal financial planning management.
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4.4.3 Coefficient Correlation, R,= 0.671

Which means 67.1% of the independent variables and dependent

variable have correlation.

4.4.4 Coefficient of Determination, R2 = 0.450

45% of the changes in personal financial planning management can

be explained by the change in independent variables (age, gender,

income, personal income, level education and investment planning).

The other 55% cannot be explained, maybe omitted some other

important variables.

4.5 Autocorrelation Detection

It is indicated by a sequential pattern as the error term which means some

other variables are changing systematically and influencing the dependent

variable. A standard test for identifying autocorrelation is Durbin Watson test.

This is a test statistic used to detect the presence of autocorrelation in the

residuals from a regression analysis. To indicate DurbinWatson statistic

good or not, check the value of DurbinWatson. If the value below than 1.5

and greater than 2.5 show that have Durbin-Watson problem or

autocorrelation. Good Durbin-Watson statistic value between 1.5- 2.5.

From regression result:

K=5, N=100

dL = 1.571

dU = 1.780

d = 1.853
http://www.answers.com/topic/test-statistic-1http://www.answers.com/topic/autocorrelation-1http://www.answers.com/topic/errors-and-residuals-in-statisticshttp://www.answers.com/topic/regression-analysishttp://www.answers.com/topic/regression-analysishttp://www.answers.com/topic/errors-and-residuals-in-statisticshttp://www.answers.com/topic/autocorrelation-1http://www.answers.com/topic/test-statistic-1


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0 dL dU 2 4 - dU 4 dL 4

1.571 1.780 0.220 0.429

Based on the table, the Durbin Watson value is 1.853 located at column do not reject

H0 or H0* or both. It is means there is no autocorrelation problem.

Reject H0

Evidence of

positive auto-

correlation

Zone of

indecision

d = 1.853

Do not reject H0 or H0*

or both

Zone of

indecision

Reject H0*

Evidence of

negative

auto-

correlation


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CHAPTER 5 : CONCLUSION AND RECOMMENDATION

5.1 INTRODUCTION

The researcher has concluded from the whole study on the findings and the

analysis of the data from the study undertaken. Through the interpretation and

finding analysis from the questionnaires, researcher is able to prove the

problem statement thus reaching the research objectives thoroughly.

5.2 CONCLUSION

Personal financial planning is the important thing that people need to do in

their life in order to life good in the future soon. Good plan and best strategies

are needs to apply for the successful achievement goals.

In order to achieve the goals, research about the behaviour and

factors that influence the personal finance planning management is important

to the people. Basic knowledge about the personal financial planning is

needed. Moreover, people need to know what is the main problem occur in

the personal financial planning by state the problem statement. Besides,

create the theoretical framework what the factor that might influence the

personal financial planning. Make the hypothesis which predict either the

factors in an influence or not the personal financial planning management. In

order to finished the thesis, many barriers and limitation happened but the

strengths and needs to finished the thesis as benefits to others become

overcome of the barriers.

Literature review are include in research as a prove for the

theoretical framework establishment of the topic or subject area. It also to

define key terms, definitions and terminology. It is important to the others

researcher to make the references and also as a prove of the statement.


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In this proposal also indicate the research methodology which

include sampling data collection, sample and sampling design, data analysis,

and regression technique which help the researcher to collect the data and to

interpret that effectively and efficiently. Data analysis also include the t-test, f-

test and Durbin Watson test to detect whether there are significance or not

and also for autocorrelation problem.

Lastly, findings is the important part which is the result of the

investigation. In determining the factor influencing the personal finance

management, based on the hypothesis testing, can conclude that age,

personal income and level of education is the factors that determine the

factors that influencing personal finance management at Kota Bharu. Gender

and investment planning is not the factors that determines the factors that

influencing personal finance management at Kota Bharu


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5.2 RECOMMENDATION

One of the important parts in the research is recommendation and the

researcher should follow it up by giving relevant solution upon the study.

According to the research, there are several recommendations that can be

forwarded to increase the level of awareness about personal finance

management.

5.2.1: Employees

Despite the growing products of personal finance in this several years

but there are many people who are still unaware about personal

finance management. Usually employees always consume financial

product such as loans, retirement, investment, credit card and others.

They can consume all the products but the most important is they

need to manage it wisely. If they do not know how to manage it, they

can be charge with personal bankruptcy. People have potential to

charged with bankruptcy if they cannot pay back their loan or not

affordable to pay their credit card bill. Employees also need to have

retirement plan to make sure that they can survive in the future in

terms of financial after they retired.

So to make sure that they can manage their personal finance,

they need to get advice from the professional advisor or from the

financial center such as AKPK (Agensi Kaunseling Pengurusan Kredit)

and support government rules that indicate to limit two credit card per

person. It is a best action taken in order to avoid bankruptcy among

youth today at Malaysia..


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5.2.2: Future research

Since the importance of having both personal financial literacy skills

and knowledge is expected to grow, financial literacy will continue to

be a prominent research topic. This study has identified factors

influence personal finance planning management and resulted that

age, level of education and personal income influence the determinant

factors towards Personal Finance Management. The level of

awareness towards personal finance management are different

between people that work in different working sectors and also

different between the people that live in urban and rural area.

For future research, it is suggested that the future researcher

can broader the area of study by making a study in different states in

Malaysia and make a comparison which states are more aware about

personal finance management. Future research can also study by

using different independent variables that factors may influence

towards personal finance management. There are many factors that

may influence peoples personal finance management such as family

background. Family background or parents is one of the important

variable that influence the way people manage their personal finance

because family and parents are shape our perception about the

importance of managing personal finance and also shape us on how

to spend our money.

Because financial literacy has become increasingly importance

for the economic wellbeing of the nations future, it is important that it

can be explicitly linked with financial behaviour, and hence financial


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success and sustainability. No financial literacy study has yet achieved

this. Another area of research could then focus on the components of

financial literacy and determine which are the most and least critical to

financial success and sustainability.

Several studies revealed that personal financial skills and knowledge

are acquired mostly through trial and error, but no research to date

has actually attempted to investigate what types of financial

experiences and characteristics have the most influence on an

individuals personal financial literacy or competence. Hence another

area of research could focus on gathering extensive details of financial

experience and characteristics, which may prove to be important

influential variables in modelling financial literacy among general

populations.

Finally, further research could focus on the actual measurement of

financial literacy. Extensive research and testing is needed to

determine consistency and more realistic benchmarks for the ongoing

measurement of financial literacy.


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5.2.3 Public awareness campaigns

While many financial education materials exist, consumer demand for

financial education is not high among the general population. This may

be because of people dont know what they dont know and are

unaware of how their lack of knowledge may be costing them money

or opportunities. Public awareness campaigns could be one solution to

this. These types of campaigns could teach public how to manage

their personal finance. Nowadays there are not too much campaign or

financial centre that public can get advice about the personal finance

management.


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Bibliography

BOOKS AND JOURNALS:

Ade`le Gritten, (2011), New insights into consumer confidence in financial services, International Journal of Bank Marketing, Vol. 29, No. 2, 2011, pp. 90-106.

Altfest, L. (2007), Personal Financial Planning, McGraw-Hill, New York.

Chen, Haiyang,(2002), Gender Differences in Personal Financial Literacy AmongCollege Students, Financial Services Review.

David S. Murphy and Scott Yetmar,(2010) Personal financial planning attitudes: apreliminary study of graduate students,Management Research View, Vol. 33 No. 8,pp 811-817.

Gitman, L.J and Joehnk, M.D (2005), Personal Financial Planning, Thomson South-Western, New York, NY.

Gujerati Damodar N., Porter Dawn C.(2009), Basic Econometrics, McGraw Hill pp278-279.

Jeff Madura (2007), Personal Finance,Pearson Education. Inc.

Joyce K.H. Nga, Lisa H.L. Yong and Rathakrishnan D. Sellapan,(2010) A study ofFinancial Awareness among youths, Emerald Group Publishing Limited, Vol. 11 No.4, pp. 277-290.

Ming Ming Lai And Wei Khong, (2009), An Empirical Analysis Of Personal FinancialPlanning In An Emerging Economy,European Journal of Economics, Finance andAdministrative Sciences,ISSN 1450-2275 Issue 16 (2009).

Petersen H. Craig, Lewis, W. Cris, Gurmit Kaur, and Ng Phaik Lian, (2010),Managerial Economics Essential/Fundamental,Pearson Hall.

Tuan Hock Ng, Woan Ying Tay, Nya Ling Tan, and Ying San Lim (2011), Influenceof Investment Experience and Demographic Factors on Retirement PlanningIntention, International Journal of Business and Management, Vol 6, No. 2 February2011.

INTERNET SOURCES :

Methodology retrieved April 6,2011, fromhttp://en.wikipedia.org/wiki/Methodology

Personal Financial retrieved January 25, 2011, fromhttp://en.wikipedia.org/wiki/Personal_finance

Personal Finance retrieved January 25,2011, fromhttp://www.managementhelp.org/prsn_wll/finance.htm
http://en.wikipedia.org/wiki/Methodologyhttp://en.wikipedia.org/wiki/Personal_financehttp://www.managementhelp.org/prsn_wll/finance.htmhttp://www.managementhelp.org/prsn_wll/finance.htmhttp://en.wikipedia.org/wiki/Personal_financehttp://en.wikipedia.org/wiki/Methodology


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QUESTIONNAIRE

FACTORS THAT INFLUENCE PERSONAL FINANCIAL PLANNING

MANAGEMENT: A STUDY AT KOTA BHARU

Dear respondents,

I, Arfawaty Binti Razali, student of BBA (Hons) at present conducting a research on

Factors That Influence Personal Financial Planning Management: A Study At Kota

Bharu. This research is conducted as part of subject fulfilment for my final year. I

would appreciate it if you would complete these questionnaires. All information and

respondents identity will be kept strictly confidential and will be use for academic

purpose only. Thank you very much for your time and cooperation.

Saya, Arfawaty Binti Razali,pelajar tahun akhir Ijazah Sarjana Muda Pengurusan

Perniagaan (kepujian) Kewangan sedang membuat satu kajian berkenaan dengan

Faktor-Faktor Yang Mempengaruhi Amalan Pengurusan Kewangan Peribadi : Kajian

Di Kota Bharu. Saya amat menghargai kerjasama yang diberikan kerana sudi

meluangkan masa untuk menjawab soalan-soalan tentang kaji selidik berikut. Segala

maklumat adalah sulit dan akan digunakan untuk tujuan akademik sahaja. Terima

kasih di atas kerjasama anda.

Thank you/ Terima Kasih


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PART A : DEMOGRAPHIC

Respondent background

1. Gender

Male Female

2. Race

Malay Chinese

Indian Others

3. Age

20 and below 41 - 50

21 - 30 51 and above31 - 40

4. Marital status

Single Married

5. Level of education

SPM/STPM

Diploma

Bachelor

Postgraduate

Others

6. Working sector

Public sector Self-employed

Private sector Unemployed

7. Personal income

RM 1000 and below RM 3001 RM 4000

RM 1001 RM 2000 RM 4001 RM 5000

RM 2001 RM 3000 RM 5001 and above


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PART B : PUBLIC AWARENESS

8. Do you concern about your personal financial planning?

Yes No

9. Do you think, monthly budgets are necessary?

Yes No

10. Do you always make a monthly personal financial planning budget?

Yes No

11. Do you follow your monthly budget?

Yes No

12. A person makes expenditure in everyday. Do you often consider whether

the real necessity before you make a purchase in your expenditure?

Yes No

13. Do you think electronic payments (e.g. credit cards, debit cards)

encourage you to spend more?

Yes No

14. Do you make financial planning for the future?

Yes No

15. How much your expenditure per month?

Less than RM300RM301-RM600

RM601-RM900

RM901 and above


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16. Do you have made an investment?

Yes No

(If your answer is yes, please continue the following questions).


Golds

Properties

Unit Trust (ASB, ASN, ASW and others)

Mutual Funds

Tabung Haji

Others(please identify)

18. How much do you invest your money per year?

Less than RM300

RM301-RM600

RM601-RM900

RM901 and above

19. I start make investment from.......

10 years old and below 31-40 years old11-20 years old 41 years old and above

21-30 years old

20. What are the factors that influence your investment?

Spending pattern

Attitude

Awareness

Parental guidance

8/22/2019 financing

financing proposal

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