Abstract
Interest in saving is growing as researchers acknowledge the impact of psychological and behavioural factors on financial behaviour and financial institutions recognise its implications for products and services. This thesis is motivated by the fact that although many studies have examined the saving behaviour of adults and children, few studies investigate the factors which influence the adoption of saving by students. The present study contributes to saving behaviour theory with evidence that psychological and behavioural factors significantly influence a student’s ability and willingness to save, with similarities and differences drawn to the literature on the saving behaviour of adults and children. This study considers the topic within the banking sector because by understanding student saving behaviour and financial needs, the ANZ Bank could significantly improve the success rate of customer acquisition of the student market and begin to support healthy consumptive practices, along with encouraging regular saving behaviour. This would enable the ANZ to retain these customers with a high potential customer lifetime value. The conceptualisation of this study draws on literature from consumer behaviour, psychology and economic psychology.
The study considers the impacts of four psychological and behavioural constructs on student saving behaviour within a conceptual model and explores these relationships in the context of student consumers in the New Zealand banking sector. This study examines the influence of the motivations to save of future lifestyle obligations, everyday living costs and holidays/travel on student saving. The attitudes towards saving of self-consciousness, wealth and pointlessness are also examined in relation to saving behaviour. Student future orientation is examined in relation to saving behaviour to establish whether students consider the future consequences of their current consumption behaviours. Lastly, the influence of the personality dimension conscientiousness will be examined in relation to saving behaviour to establish whether personality variables are able to predict differences in student saving.
The study contributes to this discussion by considering how psychological and behavioural concepts and theories help to facilitate the process of describing, explaining, and predicting student saving behaviour. An understanding of the influence of these factors on student saving behaviour can assist in the formulation of effective marketing strategies, such as integrated marketing communications, advertising, product and service development tailored towards student motivations for saving and financial literacy programmes for the student market.
This thesis applied a philosophical positivist and sequential quantitative approach to research. An internet survey was distributed to 10,179 Otago University student email accounts, yielding a final sample of 956. The data was analysed using multiple methods of analytical techniques including common factor analysis (CFA), multiple regression, one-way ANOVA and independent samples t-test. The results indicate that six out of eight research hypotheses are supported with statistical significance. The findings indicate that the motivation of future lifestyle obligations is positively related to saving behaviour and that the motivation of everyday living costs is negatively related to saving behaviour. The present study revealed new knowledge that student saving behaviour is positively influenced by the attitude of self-consciousness and that the more students view saving as a pointless behaviour the less likely they are to conduct saving behaviour. Unlike previous studies on adults and children which sought to establish a relationship between the personality dimension conscientiousness and saving behaviour, this study found that saving behaviour is not significantly influenced by their level of conscientiousness. The study revealed that the saving behaviour of students is positively influenced by the degree to which they consider the future consequences of their current actions. Furthermore this study found that student saving behaviour will increase as the student gets older. This study contributes several important managerial insights to the ANZ Bank. Firstly, this study provides empirical evidence that whether or not a student considers the future consequences of their current actions will significantly influence their saving behaviour. Yet, to consider what implications saving for the future may have, students must be fully aware what impact their current consumptive decisions will have on their future economic situation. A financial education or financial literacy programme could be implemented by the ANZ which is geared towards encouraging high-school students to conduct positive and healthy financial behaviours.
Secondly, this study provides empirical evidence that the motivation of holidays/travel significantly influence student saving behaviour. The ANZ could develop a holiday incentive package where those who held their account with the ANZ the entire year could receive either free travel insurance or a travel card preloaded with foreign currency when they provide proof of their travel arrangements. Otherwise, if the students were not travelling overseas but rather kept within New Zealand, they could be placed into a draw to win a ticket for a popular New Year’s Eve festival such as Rhythm and Vines in Gisborne. Thus, encouraging students to keep or open an account with the ANZ by rewarding them with holiday incentives