Determinants of spending behaviour towards debt among young professional in Malaysia

Chew, Zhen Chang (2019) Determinants of spending behaviour towards debt among young professional in Malaysia. Project Report. Universiti Teknikal Malaysia Melaka, Melaka, Malaysia. (Submitted)

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Abstract

Malaysia was reported that having high household debt to gross domestic product (GDP), this advocate that on average young Malaysians are committing to higher debt levels beyond their means. So, the aim of this study is to examine the spending behaviour towards debt among young professional in Malaysia by using theory of planned behaviour. This study was conducted to identify the components that effect spending behaviour towards debt and lastly to examine the relationship between components with spending behaviour towards debt. The total 422 questionnaires were distributed and completed by the young professional. Data was analysed by using descriptive, t test, factor analysis, Pearson Correlation and Multiple Regression that included in Statistical Package for Social Science (SPSS). The results firstly revealed that subjective norm is the components that influence most on the spending behaviour towards debt among young professional in Malaysia. Secondly, it shows that financial literacy has positive relationship with spending habits where higher level of financial literacy will influence the most desirable spending habits. Thirdly, financial attitude was inconsistent with previous research that stated financial attitude as most influencing towards spending behaviour. Lastly, the result indicates that perceived behavioural control only have negligible positive relationship with spending behaviour towards debt. For the theoretical contribution, the research found that the theories of planned behaviour are valid which can be used to identify the causes of financial issues and indebt-ness. As for future research it is recommended to extend these results in other geographical areas such as focused in certain state. Thus, the researcher can get more details analysed data and comparing the result by each state in Malaysia.

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