Black Generation Y Students' Knowledge Of And Attitudes Towards Personal Financial Management
The effective and efficient management of personal finances is critical for everyone, particularly in a world where uncertainties prevail. Owing to continuous change, new financial challenges frequently confront individuals that culminate ultimately in uncertainties concerning individuals' financial position and future. Having low levels of debt, an active savings and retirement plan, as well as following an expenditure plan, will lead to financial wellness, which demonstrates an active state of financial wealth. A comprehensive financial plan makes individuals attentive when dealing with financial issues, and acts as a guide when making financial decisions. Owing to insufficient financial literacy and skills, personal financial management is challenging and often results in erroneous financial decisions. Financial knowledge forms the basis for financial skills and competence, which are influenced by personal attitudes in both spending and saving. Therefore, in order to plan effectively, and control and manage financial risks and opportunities in the future, financial skills and abilities are essential. Adequate financial knowledge and skills lead to effective personal financial management and sound financial decisions in the short-term as well as in the long-term. Planning for financial independence should start as early as possible during the financial life cycle, usually at 18 years of age. Students are a rewarding market for financial institutions such as banks, insurance companies, pension funds and brokerage companies, potentially leading the way forward to establish brand-loyalty throughout adulthood. However, the lack of financial management and planning experience, as well as financial literacy and financial skills, make students particularly susceptible to the aggressive marketing tactics of financial institutions, which may be harmful to students' financial freedom. As such, financial institutions and professionals have to gauge effective ways to convey financial knowledge and product information to a target market to deliver improved financial service as well as understand the relevant consumer behavioural aspects of a target market when developing marketing strategies. Published literature on the South African Generation Y consumer behaviour is limited and none that is focused specifically on attitudes towards personal financial planning, financial literacy and perceived personal financial management skills of the significantly sized black Generation Y cohort. This cohort is defined as individuals born between 1986 and 2005. In South Africa, Generation Y individuals accounted for 38 present of the South African population, with the black Generation Y individuals representing 83 present of this generational cohort. Additionally, the black Generation Y cohort of South Africa account for approximately 32 present of the total population, resulting in a highly salient market segment. Of particular interest to marketers and professionals, including financial institutions and those involved in financial management, especially financial planning, are those individuals attaining tertiary qualifications, and as such they are likely to enjoy higher earnings and a higher social standing, which together is likely to make them opinion leaders and trendsetters amongst their peers. The primary objective of this study was to investigate black Generation Y students' knowledge of and attitudes towards personal financial management within the South African context. The target population, relevant to this study, was defined as full-time undergraduate black Generation Y students, aged between 18 and 24 years, enrolled at South African registered public higher education institutions (HEIs). From the sampling frame, comprising 23 registered South African public HEIs, one traditional university and one university of technology located in the Gauteng province, were selected using a judgement sampling method. A convenience sample of 400 ful