Money Management Practices of College Students

Henry, Reasie A., Weber, Janice G., Yarbrough, David, College Student Journal

Many college students are living on the edge of financial crisis and many of them do not possess the knowledge needed to manage their money. The purpose of the study was to determine the use of money management practices of Education college students at the University of Louisiana at Lafayette. The sample consisted of 126 Education majors in randomly selected Education courses which were being taught, at each academic level, in the Spring 2000 semester. Subjects were administered a 13-item questionnaire including items concerning demographic data. income, debt, and budgeting practices. Frequency distributions and Pearson Chi-Square were computed. Findings showed that women were more likely to have a budget than men, married students with budgets were more likely to follow them, and those aged 36 to 40 were more likely to follow them most of the time.

Many college students are living on the edge of financial crisis and many of them do not possess the knowledge needed to manage their money. While students at the university, they are constantly accumulating debt, through student loans and credit cards. They may not realize how their current debt can negatively affect their future credit rating. Without consistent money management practices, students will find it difficult to reach financial goals (Bowen & Lago, 1997).

What does a good money management plan include? According to Musk & Winter (1998), it will include "regular generation of financial statements; budgeting; control of spending; recording income and expenses: and tax, insurance, investment, retirement and estate planning" (p. 1). The difficulty in creating and using a money management plan is that many students are not familiar with money management practices (Chen & Volpe, 1998). Chen & Volpe (1998) blames the colleges for not providing financial management courses for students. The Youth and Money Survey (1999), found that even though 65% of the students had an opportunity to schedule a money management course, only 21% of them took the course. The amount of financial information a student has usually impacts their ideas and choices regarding finances (Chen & Volpe, 1998). Kendrick (1999) stated that only 44% of students understand the term `budget'; in fact, only 18% of the general population possesses a basic …

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Publication information: Article title: Money Management Practices of College Students. Contributors: Henry, Reasie A. - Author, Weber, Janice G. - Author, Yarbrough, David - Author. Journal title: College Student Journal. Volume: 35. Issue: 2 Publication date: June 2001. Page number: 244. © 2009 Project Innovation (Alabama). COPYRIGHT 2001 Gale Group.

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