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Young People’s Financial Preferences: The Impact of Loan and Deposit Interest Rates on Borrowing and Saving Behaviors

Author

Listed:
  • Monica-Gabriela PERJESCU

    (National University of Political Studies and Public Administration (SNSPA), Bucharest, Romania)

  • Pompei MITITEAN

    (National University of Political Studies and Public Administration (SNSPA), Bucharest, Romania)

Abstract

This study aims to investigate the preferences of young people aged 17 to 30, as well as the preferences of graduates who are already employed, regarding their desire to take out a loan or purchase goods using their own resources. At the same time, the paper examines the impact of the evolution of deposit interest rates on young people, determining their inclination towards other forms of savings rather than bank deposits. The study employs a quantitative method, applying an online questionnaire created through Google Forms, which automatically collected data between January and April 2024, with a total of 188 respondents. The analysis of the obtained data was conducted using the SPSS program. The results show that respondents consider current loan interest rates to be high, thus preferring to purchase goods using their own resources rather than taking out loans. Furthermore, they show interest in other forms of savings, such as government bonds, corporate bonds, listed shares, mutual funds, real estate investments, and insurance policies, instead of bank deposits. In general, the results indicate that as loan interest rates decrease, young people become more inclined to take out loans, and as bank deposit interest rates become more advantageous, they are more likely to establish deposits.

Suggested Citation

  • Monica-Gabriela PERJESCU & Pompei MITITEAN, 2025. "Young People’s Financial Preferences: The Impact of Loan and Deposit Interest Rates on Borrowing and Saving Behaviors," CECCAR Business Review, Body of Expert and Licensed Accountants of Romania (CECCAR), vol. 6(1), pages 59-72, January.
    • Handle: RePEc:ahd:journl:v:6:y:2025:i:1:p:59-72
    DOI: 10.37945/cbr.2025.01.07
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    References listed on IDEAS

    as
    1. Victor Emanuel CIUCIUC & Maria-Manuela CATRINA & Paul Ștefan MARKOVITS & Pompei MITITEAN, 2024. "Sustainability in the Digital Age: The Impact of Social Performance on the Profitability of Cyber Companies," CECCAR Business Review, Body of Expert and Licensed Accountants of Romania (CECCAR), vol. 5(5), pages 22-31, May.
    2. Pompei MITITEAN & Florina-Nicoleta SĂRMAȘ, 2023. "Harmonizing Sustainability Disclosure and Financial Performance. An In-depth Exploration within the European Energy Industry and Beyond," Management Dynamics in the Knowledge Economy, College of Management, National University of Political Studies and Public Administration, vol. 11(4), pages 385-401, December.
    3. Alexandra DINU & Marian-Mircea STANESCU & Andreea BARBU, 2020. "Young People’S Attitudes And Financial Behaviour. Evidence From Romania," Business Excellence and Management, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 10(3), pages 36-46, September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    interest; loans; deposits; monetary policy interest; the economic crisis; the COVID-19 pandemic; the Romanian banking system;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets

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