Acquired Financial Knowledge and Attitudes of South African University Students And Their Financial Decisions

This paper considers the financial management practices of university students by examining the relationships among financial knowledge, financial management attitudes and spending habits (financial decisions) of university students in South Africa. The evaluation of the relationships employed the established theories of planned behaviour and family resource management in conjunction with structural equation modelling analysis. The study collected survey data from 479 students that had taken finance-related courses at a major university in South Africa. The results suggest that students’ financial knowledge positively influenced their financial management attitudes and that higher level of students’ financial management attitudes led to good spending habits. However, students’ financial knowledge had no direct impact on students’ spending habits. Instead, students’ financial management attitudes fully mediated the relationship between students’ financial knowledge and their spending habits, suggesting financial knowledge does not on its own lead to good spending habits (financial decisions). The findings of the paper have implications for students, their funders, the government, and university administrators in terms of students’ financial literacy education and the allocation of increasingly scarce economic resources devoted to educational welfare.