REVIEW OF RELATED LITERATURE

This chapter presents the relevant sources of information of

the related literature and studies that provide the background

knowledge and concepts regarding the effectiveness of the

improvement of the students saving behavior.

Saving

Saving in a simple definition is the excess of income over

all expenditure, where the expenditures are also mentioned as

consumption, which is life contributions and insurance (Denton,

Fretz, & Spencer, 2011). Saving is considered as the income that

is not spent over consumption of needs and wants of a person.

Even though saving has many different meaning to every people, to

some it all means putting money aside for future or other

meaningful purposes. Saving might be a short or long process of

setting aside the excess money, allowance, or current income

depending on the corresponding amount or quota. But saving money

could be really hard especially with the different influences of

the mainstream media, products, and services. Some person

specifically students spend so much that they forget how to

manage their own money which can later lead to financial issues.

In a recent study by Adam K. Anderson (2018) and his team of

neuroscientists at Cornell University found that people would

much rather earn money than save it. The researchers knew that

our brain has learned to prioritize earning more money over

saving it. Whenever people are able to get their salary or

allowance, they tend to set that money aside for their daily

needs, pay for bills and expenditures. Then the remaining money

could be used to buy their wants as people has a mindset of

giving presents for themselves as they deserve it after a long

month of working hard to earn that money. So that implies to the

result of not putting aside for their savings. As this preference

refers for earning money over saving is a learned behavior. It’s

a rational from brain’s perspective that one person must earn in

order to save but people must also have to practice being mindful

of squirrelling away money according to the said study. In order

to change up the certain saving behavior one person has, they

must acknowledge the problem of setting aside variety of

priorities and expenses and make a choice to save by setting a

goal to set aside money for savings it can be every day or every

month depending on a certain quota. This practice of attending to

saving money makes you mindful and a having a mindset of not only

prioritizing the present but also the future.

There are many different ways of saving money. It can be on

banks and opening a savings account. But it can be either by

simply having a coin banks or the traditional piggy banks.

According to editor of encyclopedia of Britannica, Gloria Lotha

(2019), saving is process of setting aside a portion of current

income for future use, or the flow of resources accumulated in

this way over a given period of time. As saving may take the form

of increases in bank deposits, the extent to which individuals

save is affected by their preferences for future over present

consumption, their expectations of future income and to some

extent by the rate of interest. It always depends on the people

whenever they want to put aside their money to save. Where they

can set and be comfortable on getting their main goal which is to

save.

Saving Behavior

According to the Maps world of finance (2018), saving

behavior is defined as an understanding on how people save in a

country in order to realize the economic condition of that

country. For the researchers, it is normal facts that people are

saving more, the levels of their personal income are increasing

as well. Saving behavior is the money keeping activity after they

use it for their own wealth. It is also the practice of being

mindful when it comes to handling money and setting aside for

prioritizing future expenses or purposes. Saving behavior also

can define as frequently practiced behaviors, done without a

particular sense of awareness with the goal of freeing up funds

for savings. Automatically packing lunch for work, browsing

supermarket shelves for discounted products and setting aside

amount of money to spend are thrifty money-saving behaviors that

should be habitual for many people.

There are many aspects that related to the saving behavior.

Research about students’ saving behavior in Malaysia that has

been done by Salikin, et al. (2012) mentioned about the problems

of doing saving in university life, such as the uncertain about

where the money spent, or even about taking money from parents or

others without permission for the spending that driven by their

desires than their economic needs. From previous research,

students have some reasons of doing saving, such as to achieve

goal, do saving until the end of the semester, and do saving for

paying down debts. About this study, they investigated students

saving behavior by knowing the problems they encounter in doing

saving practices during their university life. In addition, they

also consider finding the factors why student tend to save their

money. As they find they find that most of the save their money

for future purposes such as for paying the school requirements,

paying debts and for the end of semester vacation. And that

reminds us the researchers on how important it is to have a

mindful practices about savings which leads to a frequently

practice of a saving behavior.

 Meanwhile, in the study of Henrik Cronqvist and Stephan

Siegel (2011), entitled "Origins of Saving Behavior", they found

out that there are several empirical studies have indeed found

that non-standard models and “behavioral factors” explain

variation in savings (or the lack of savings) across individuals.

As a result, genetic variation in savings behavior may not

necessarily reflect only genetic preferences, as in standard

models, but may also reflect cognitive ability, self-control, or

other non-standard factors being partly genetic. Turning to

social, rather than genetic, transmission of preferences and

behavior, others have emphasized parents’ instilling behaviors

into their children. There is indeed anecdotal evidence

suggesting that at least some parents exert costly effort to

teach their children particular savings behavior, by providing a

piggy bank, opening a savings account, and otherwise emphasizing

the benefits of a frugal lifestyle. Parent-child socialization

has been found to be empirically relevant for behaviors other

than savings, such as religion. While there work on the effects

of government-sponsored financial education programs on savings

behavior, there is a surprising lack of empirical analysis of

parenting and savings behavior.

Based on the study of Legenzova & Gaigaliene (2017) they

aimed to assess the saving behavior of Lithuanian high school

students. The survey questioned their ability to save, saving

level, regularity in saving, saving motives, attitude towards

saving, saving motivation and confidence in the saving skills of

Lithuanian high school students. A total of 440 questionnaires

were collected in spring 2017 portraying a representative sample

of Lithuanian High School students’ population. Results of the

survey revealed that the level of saving among Lithuanian high

school students is relatively high and similar to the levels of

adolescent savings in the other countries. Most of Lithuanian

High School students are irregular savers; their overall attitude

towards saving is close to neutrality; their motivation to save

may be viewed as moderate, despite their acknowledgment of

necessity to save. The aggregate data revealed that the vast

majority of the surveyed students tend to underestimate their

saving behavior habits and skills.

Research about students’ saving behavior in Malaysia that

has been done by Salikin, et al. (2012) mentioned about the

problems of doing saving in university life, such as the

uncertain about where the money spent, or even about taking money

from parents or others without permission for the spending that

was driven by their desires than their economic needs. From

previous research, students have some reasons of doing saving,

such as to achieve goal, do saving until the end of the semester

(most are for vacation), and do saving for paying down debts. In

addition, according from Mohamad & Mohd (2008), female students

had greater financial well-being than male students. It stated

that women wealth has historically been lower than men. Moreover,

the results of the current study had showed that there is an

existing differences within saving behaviors between men and

women that has shown that the economic well-being and financial

behaviors of male and female differ significantly. Female hold

lower levels of wealth and have significantly lower earnings than

male. Gender based differences in behavior that are systematic

and widespread can influence consumptions, savings, investment

and the level of risk taking at aggregate level. The researches

on developing countries proved that women may have a stronger

preference than men for buying goods and services that contribute

to the human capital of their children, such as food, education,

and health care.

Coin Banks

According to Ashish (2017) Piggy banks also known as coin

banks are not actually named after pigs; in fact, they date back
to the Middle Ages, when a type of clay – called ‘pygg’ – was

used to make pots that could store money.

It is a container for storing coins or either bills, known

as money boxes or coin banks, have been used for centuries. To

encourage saving, a small slit was placed on the top of these so

that coins could enter but not exit. Because the only way to get

the coins out was by breaking the container, they were mostly

made of cheap materials. Eventually, these simple containers

evolved into piggy banks.

Early piggy banks are hardly ever found—they were shattered

in order to retrieve the saved coins—which has made it difficult

to study their beginnings. Still, a couple of theories exist

regarding the origins of the piggy bank . The most common legend

of how piggy banks were created dates back to 15th century

Europe, where a type of clay called pygg was used to make plates,

bottles, and vessels. When people threw their spare coins into

these types of pygg containers, they started to call them pygg

banks. Eventually, through a misinterpretation of the word pygg

as pig, potters began to construct moneyboxes into the shape of

pigs. As a result, the piggy bank was invented.

According to Woondruf (2012), before the creation of modern-

style banking institutions, people commonly stored their money at

home — not under the mattress, but in common kitchen jars. During
The Middle Ages, metal was expensive and seldom used for

household wares. Instead, dishes and pots were made of economical

orange-colored clay called pygg. Whenever folks could save an

extra coin or two, they dropped it into one of their clay jars —

a pygg pot.

People have been saving money since, well, whenever currency

came into existence, i.e. thousands of years ago. However, unlike

other household things, money which predominantly existed as

coins in ancient times had to be kept somewhere safe and

protected. This resulted in the rampant use of boxes and

containers to store money.

Nowadays, piggy banks are used all over the world. The major

change to most of them is that they have a removable part on the

bottom that releases the coins. Even though piggy banks are

intended for children, their important lesson of saving money is

widespread and truly priceless (College Weekend, 2014). As this

kind of traditional method tend to tell people that even in a

simple way they can save their money and help them prioritize for

their future expenses.

Spending Behavior
 As the world turn and decades past, what the generation of

yesterday is different to the generation of today. Everything

changes because nothing is constant, even the slightest factors

of people’s lives will change. The spending behavior of students

today is rather different from before leaving a question of what

could be the spending factors of students today be. According to

Neill Valentine D’Silva (2018) in his article about college

spending habits, Students are getting more and more into

consumerism every day. Students who used to live away from their

home, there are too much of brand awareness and increase the

chances of students buying things that they don’t need leaving

mass media a factor.

Spending Behavior as a conduct influencing the manner in

which a man utilize their money to fulfill their needs and needs

with no utilization of control. He also elaborated that the

spending behavior of students today is fairly not quite the same

as before, he claimed that students are getting more into

consumerism consistently. Studies have shown different factors

that can affect the spending behavior of individuals, and these

include demographic factors, age, sex, ethnicity , qualities and

learning or education). In this study the results show that there

is a strong influence of sex in spending behavior. Females tend

to spend on appearance goods like clothing while males spend for

electronics, entertainment and food. Females were also found to

exhibit more financial practices like keeping a written budget,

planning spending and saving regularly. This result was somehow

contradicted by Roberts who claimed that females were more likely

to exhibit spending behaviors, particularly compulsive buying

compared to men. It was supported by De Guzman (2011) who found

out that female students tend to spend huge amount of money on

food and art materials while male students have different kind of

priorities. Male students also spend more on recreation and

females spent more on books and school supplies outspending males

by 15%.

According to Tew (2016), the spending behavior of students

in modern times has emerged as an essential concern in our

society. He concluded that socioeconomic status issue influences

the spending behavior of the students. Meanwhile, some research

studies also support the argument that culture based spending

behavior is heavily influenced by ethnic identity and ethnicity.

In addition, according to a research of Westwood College in US

(2009) most of the seniors and college students budget the least

of their allowance for transportation, books and supplies but 40%

on optional activities entertainment, apparel and services,

travel and vacation. This states that freshmen were much more

likely to spend all their dollars quickly than juniors and

seniors. This could be due to lack of awareness of their budget

or not planning appropriately.

Pillai et. al., (2010) with availability of generous pocket

money, personal credit cards, access to credit cards of family

members or high-paid jobs at prime age, young people are faster

becoming impulsive spenders and prove reckless often. Moreover,

strategic marketers are designing products and services targeting

young generation. With the ease of information access through the

internet and web technology, marketers have managed to capture a

significant market of youth through online store sales. In the

Asian subcontinent, new trends in fashion, electronic gadgets,

sports, video games, mall culture and music are important

contributors to wasteful spending among the youth. Most of

today’s young adults, although smart and independent, scarcely

understand the value of money because of the desire to adopt

extravagant lifestyles, in addition the above mentioned factors.

Young adults under the age of 30 are now the fastest growing age

group filing for bankruptcy. Besides, evidences show that college

students tend to spend their discretionary income on instant

gratification of their wants rather than save money for their

further education. Mohamad & Maurice (2010) stated that more than

half of the respondents did not save any money when they received

their scholarship or education loan. More than half of the

students used their money for shopping. The data showed that 45

percent of them spent all their money before the end of the

semester.

The research study of Abawag et. al. (2019) about Spending

Behavior of Management Students revealed that there is a

significant difference on the spending behavior of male and

female respondents as male respondents spend more loosely

compared to females. This pattern can be traced on the findings

of Stollak, Vandenberg, Steiner and Richards (2010). One of the

factors that influence males to spend loosely is the fact that

they were more likely to go out to eat than females. They also

elaborated that, females were found to be fond of creating a

monthly budget than males which lead them to spend tightly or

more efficiently. This is parallel with the conclusion of, that

females were found to exhibit more financial practices like

keeping a written budget, planning spending and saving regularly.

As some of the study shows that that college students’

spending behavior are greatly influenced by their family

background. Parents play a key role in shaping not only the

attitudes about financial management but also life attitudes in

general of their children. It is therefore critical that young

individuals began to learn about finance during adolescence for

them to have the best possible chance to be successful in

adulthood. To have a good financial knowledge is not enough.

Success requires a set of healthy and positive attitude and

supportive parents who expect responsible financial attitude.

Financial Literacy

Several studies have acknowledged very low levels of

financial literacy among senior high school and college students

as they tend to fail financial literacy test (Avard et al.,

2005). The incompetency exhibited by the senior high school

students therefore limits their ability to make sound financial

decisions.

As indicated in the literature, people with low financial

literacy are more likely to have financial related issues in the

real world. The low level of financial literacy could also make

small financial issues become overwhelming which could turn into

financial stress and consequently affects the other aspects of

live such as personal relationships or performance at work. The

low level of financial literacy and its consequences then show

the need for stakeholders in educational system to put policies

in place to ensure that the level of financial literacy among

senior high school students in Ghana is improved since financial

literacy has essential implication for future behavior.

 A study assesses the level of financial literacy of Senior

High School students in the Kumasi Metropolis. The study surveyed

320 students to investigate their level of financial literacy

through the administration of questionnaires. Findings from the

study reveal that students need to improve their personal finance

knowledge. The results show that the students answered about

48.7% of the questions correctly. The results also reveal that

many of the students are seen to be familiar with issues relating

to simple interest, compounding and loan guarantee. In contrast,

the students are less knowledgeable and inexperienced with issues

concerning personal financial planning, budgeting and overdraft.

The incompetency exhibited by the senior high school students

therefore limits their ability to make sound financial decisions

and hence more likely to have financial related issues in the

real world. The low level of financial literacy could also make

small financial issues become overwhelming which could turn into

financial stress and consequently affects the other aspects of

live such as personal relationships or performance at work. The

low level of financial literacy and its consequences then shows

the need for stakeholders in educational system to put policies

in place to ensure that the level of financial literacy among

senior high students in Ghana is improved since financial

literacy has essential implication for future behavior. It is

recommended that personal finance literacy course is well

elaborated in the academic curriculum of senior high schools.

Also, the national financial literacy week should be extended to

school as workshops to encourage student’s participation in

financial literacy.

However, it is believed that there has been a lot of

discussion but little agreement on the conceptualization of

financial literacy. Remund (2010) reviewed 100 resources and

found that the definition of financial literacy involves five

categories: (i) understanding financial concepts, (ii) being able

to communicate about these concepts, (iii) ability to deal with

personal finances, (iv) being good at making financial decisions

and (v) being confident of making effective plans for future

financial needs.

Meanwhile, other researchers and communities have not

approved this definition. In a paper on this subject Huston

(2010) reassessed 71 studies and concluded that nearly one-half

of these studies described financial literacy as the financial

knowledge. Others considered financial literacy to be something

wider than knowledge, but they did not agree about additional

components. Some claimed that money management skills must be a

part of financial literacy. For instance, the researchers defined

financial literacy as the ability to use knowledge and skills to

manage financial resources effectively for a lifetime of

financial well-being, a definition which is quite close to the

one used by Jump Start Coalition for Personal Financial Literacy

(2015). However, other researchers believe that being able to

make the right decisions is also an additional component.

Specifically, in their study on other factors that affect the

people on having a low personal financial literacy. Your level of

financial literacy affects your quality of life significantly.

According to Christiana Mbazigwe (2013) it affects your

ability to provide for yourself and family, your attitude to

money and investment, as well as your contribution to your

community. Financial literacy enables people to understand what

is needed to achieve a lifestyle that is financially balanced,

sustainable, ethical and responsible. It also helps entrepreneurs

leverage other people’s money for business to generate sales and

profits.

Financial literacy may have an impact on financial decision-

making, because learning about finance is necessary in order to

make the right financial decisions and invest the most

effectively, which leads to a gradual increase in their wealth.

Less knowledgeable people make more costly decisions.

Coin Banks or Piggy Banks for Meaningful Saving Behavior

 Coin Banks could be the easiest way of saving money

especially for students. In the study of S. De Francisco, M.

Casais & P. Desmet (2014), they proposed that it is interesting

to consider the well-being effects of saving through traditional

method such as coin banks or piggy banks. Saving is understood as

an activity in which an individual accumulates money with the

intent to spend it in the future. Given that saving can connect

one’s present state to a meaningful future state, we became

interested in exploring how this behavior can be experienced as

more meaningful, and in that sense contribute to well-being. They

used the Billegas piggy bank as a design case in order to

distinguish and evaluate factors that could enhance the act of

saving and make it meaningful. Billegas is a collection of money

boxes depicting cartoon characters that allows the users to

choose a character, pick a name for it, and set a saving

intention. In doing so, it adds a tangible quality to one’s

intangible saving intentions. Despite the fact that this product

was not designed with the specific intent of making a

contribution to happiness, it incorporates some basic ideas that

make saving enjoyable as well as effective, and in this sense we

found it interesting to explore regarding meaning and empathy.

This is accomplished by the act of defining intentions that let

people commit to a goal. The motivation to save money is still

rarely explored and so is its relation with happiness.

 Furthermore, the formats in which people can save money,

like saving accounts, piggy banks, or other investing strategies,

have been hitherto insufficiently explored in a design (and well-

being) perspective. We aim to understand how design can motivate

people to save money in a more meaningful way and contribute to

their happiness. The Billegas was designed to help people

improve their saving experience. They used the Positive Design

framework to evaluate characteristics of these piggy banks based

on the three ingredients that compose it: the playfulness of

interaction (Pleasure), the act of writing down an intention

(Personal Significance), and the commitment to that intention

(Virtue). The playfulness of interaction (including selecting a

character, customizing, and naming the product) will help users

to enjoy their saving activity.

The act of writing down one’s intentions and displaying the

product in a visible place help the users to experience the

meaningfulness of their saving activity, making the mental

connection between the saving, and the meaningful activity which

will be made possible with the saved money. Finally, it relates

to virtue in the sense that users set intentions, which translate

into commitments that nudge them into considering their spending

and saving behaviors in a more careful and responsible way. In

order to understand better the value of the characteristics of

this product in terms of fostering well-being, it is interesting

to evaluate it in a real context. For that they carried out a

study to determine the impact of this particular piggy bank on

people’s happiness. From the studies, they concluded that design

can contribute to the meaningfulness of saving, by enabling users

to set up an intention, visualize it, and empathize with it.

During the studies, participants mentioned several occasions in

which the use of money is now being limited to credit and debit

cards, instead of coins and bills. They see this as a tendency

that can increase with new technological developments. However,

it is possible to learn a lot from traditional ways of saving,

and such lessons that can provide a salient contribution to well-

being. The evaluated strategies are seen as potential enhancers

of meaningfulness in saving and thus contribute to the happiness

of those engaged in saving.

This study creates a new insights that were gathered in

other areas to increase meaningfulness in saving: the first one

was the ability to choose and transform currency into more

meaningful references by visualizing the progress of savings;

secondly, the use of alternative, more relatable forms, of

handling and saving money by resembling the use of the piggy bank

combined with digital services; and lastly, the sense of

community as a support for shared saving intentions, creating

saving networks.

As the researchers collected the data regarding to the

related literature and studies for this research, it creates a

landscape for not just us, the researchers but also for the

readers on giving full understanding about the topic and

objective of this study. Sources about how saving behavior works

and the effectiveness of coin banks on improving the saving

practices of a person especially the students which is the main

participants of this study that gives a comprehensive ideas for

this research to be a solid foundation of knowledge about the

effectiveness of using coin banks for the improvement of the

students savings behavior.

Research Design

The research problems and objectives of this study was

answered using the descriptive qualitative research design. The

design focuses on how the researchers determine the effectiveness

of the intervention through using a coin banks for the

improvement of the saving behavior of the selected senior high

school students of Theresian School of Cavite.

Research Instrument

Structured Interview

In this research, the data for the researchers to identify

the participants was gathered using a structured interview

questions made by the researchers that has gone through

validation.

The first research instrument consists of five interview

questions about the saving and spending behavior of the students

that was answered respectively by the participants own opinions.

Coin Banks

The researchers gathered the data on the interview and

analyzed the results. They separate the students that do not

frequently save money based on their answers on the structured

interview about their saving and spending behavior.

The selected students was individually given coin banks as

an intervention instrument. The Coin Banks helps the researchers

observe and determine the effectiveness that helped them to

improve their saving behavior or not.