Factors influencing students’ personal financial management skills in the era of digital transformation evidence from vietnamese students
INTRODUCTION
Background of study
The digital transformation era has drastically changed the financial landscape, enabling easier access to financial resources through innovations like mobile banking, e-wallets, and fintech solutions These digital financial services have enhanced the convenience of transactions and are key to improving financial inclusion and economic mobility, especially for the youth, by offering a variety of financial tools that aid in decision-making and financial planning.
Vietnam's digital economy is experiencing rapid growth, driven by the rising adoption of digital financial services Nonetheless, challenges like financial illiteracy, impulsive spending, and inadequate financial management remain significant, especially among university students (Nhung, 2023).
Personal financial management (PFM) has long been recognized as a critical competency that directly influences an individual’s financial well-being and long-term stability (Willis,
Research indicates a significant link between financial literacy and responsible financial behaviors, with those possessing higher financial knowledge displaying superior planning, saving, and investment practices In contrast, inadequate financial management can result in harmful outcomes, such as overdependence on credit, financial strain, and adverse psychological effects.
Effective personal finance management is vital for university students as they gain financial independence Studies indicate that many students face challenges with budgeting, saving, and investing due to insufficient financial education While digital financial tools provide convenience, they also pose risks like overspending and fraud, especially for those with low financial literacy The growing use of e-wallets and online payment systems highlights the need to equip students with essential digital financial skills.
Extensive research has been conducted on financial literacy and personal financial management, with a primary focus on developed economies where digital financial
Numerous studies emphasize the importance of financial knowledge in promoting responsible financial behaviors and reducing financial risks (Lusardi and Mitchell, 2014; Shim et al., 2010; Peng et al., 2007) However, financial literacy levels differ greatly across nations, with Vietnam ranking among the lowest in financially literate adults, trailing behind countries like Thailand (27%), Indonesia (32%), Malaysia (36%), Myanmar (52%), and Singapore (59%) (Klapper et al., 2015) A 2012 global survey conducted by TNS Market Research revealed that 33% of Vietnamese respondents did not budget their personal income and expenses, particularly highlighting that younger individuals aged 18 to 24 were less likely to budget compared to older age groups (Phạm, 2013).
Despite the wealth of international research on financial literacy, there is a notable lack of studies focusing on the specific financial challenges encountered by Vietnamese students in the digital era In Vietnam, financial education is predominantly theoretical, with few practical applications integrated into university programs (Anh, 2019; Lê Thị Hồng Hạnh, 2023) Furthermore, current research has mainly concentrated on personal finance behaviors, neglecting to investigate the influence of digital financial knowledge and tools on students' financial management skills.
While localized studies in Vietnam have explored financial management, they often emphasize general financial literacy rather than the specific factors influencing students' personal finance in the digital era Research on Gen Z's behavioral aspects of financial decision-making in a digital context is still scarce According to Visa Research (2023), a significant 69% of Gen Z students participate in online shopping, and 52% make purchases via social media However, their proficiency in managing digital finances raises concerns, particularly regarding overspending and debt accumulation.
As Vietnam rapidly embraces digitalization and digital financial services, it is crucial to understand the factors that affect students' personal financial management skills Insufficient financial literacy among students presents a serious risk, potentially resulting in long-term financial instability, debt dependence, and limited economic mobility With digital payment systems becoming standard, it is essential to equip students with the financial skills needed to navigate these platforms safely and effectively.
This study aims to bridge the existing knowledge gap by identifying the key factors affecting students' personal financial management skills in the digital transformation era
This article aims to deliver actionable insights that can shape policy recommendations, educational curricula, and financial literacy programs specifically designed for students By understanding these key factors, students will be empowered to make informed financial decisions, mitigate financial risks, and develop responsible financial habits that will serve them well beyond their university experience.
Research objectives
This research aims to analyze the factors influencing personal financial management skills among Vietnamese students in the digital transformation era, focusing on the impact of digital financial tools It will explore differences in financial management skills across various demographic groups, including gender, income level, and area of residence The study will ultimately propose actionable solutions to enhance students' personal financial management capabilities.
Research mission
To successfully achieve the proposed research objectives, the topic carriers out the following specific research tasks:
- Systematize the theoretical foundations surrounding personal financial management and digital transformation;
- Identify factors affecting digital transformation on personal financial management skills from previous studies;
- Propose a model of factors affecting students’ personal financial management skills and explain the model;
- Identify and analyze the level of influence of factors on personal financial management skills of Vietnamese students in the digital transformation era from collected data;
- Based on the analysis results, specific solutions and recommendations will be proposed to enhance students' personal financial management skills
Research subjects and research cope
Research subject: The factors influencing students’ personal financial management skills in the era of digital transformation;
The survey targets all students in Vietnam, encompassing both urban and suburban areas Due to constraints in time and resources, the sample size was calculated using the formula n = 𝑘 × ∑ 𝑚 𝑗=1 𝑃 𝑗 (Hair et al., 2010) In this formula, n represents the sample size, k is set at 5 observations per variable or 10 per variable, 𝑃 𝑗 denotes the number of observed variables in the jth scale, and m indicates the number of scales used.
This study examines six influencing factors through a survey consisting of 48 questions To ensure valid results, a minimum sample size of 245 participants is required, with an additional 5% reserved for potential invalid responses Consequently, the survey will target approximately 258 subjects.
Spatial scope: This study focuses on students across different regions of Vietnam, ensuring a representative sample including urban and suburban areas;
Time scope: The study was conducted over a period of 3 months, from 10/2024 to 01/2025; information through surveys from students from 12/2024 to 01/2025;
Content scope: The content of the topic focuses on researching the factors that will affect students’ personal financial management skills in the digital transformation era in Vietnam.
Research questions
To achieve the proposed research objectives, the topic focus on answering the following questions:
1 What are the key factors influencing students’ personal financial management skills among students in Vietnam during the digital transformation era?
2 What role do digital financial tools play in improving students’ personal financial management skills?
3 Are there significant differences in personal financial management skills across demographic groups (e.g., gender, income, residential area)?
Structure of the study
The research topic is structured in five chapters, in addition to the references and appendix: Chapter 1: Introduction
Chapter 2: Literature review and hypothesis development
Chapter 4: Data analysis and research findings
Chapter 5: Conclusion, implication and limitation
LITERATURE REVIEW AND HYPOTHESIS DEVELOPMENT
Definitions
2.1.1 Definition, importance and use of digital financial tools of personal financial management skills
2.1.1.1 Overview of personal financial management skills
Personal finance management involves planning and overseeing an individual's financial activities, including income, spending, savings, and investments Key components include budgeting, saving, purchasing insurance, and securing loans or mortgages By effectively managing their finances, individuals can allocate resources efficiently, paving the way for financial independence and the achievement of long-term goals.
Personal financial management skills are essential for individuals to effectively plan and execute a sound spending strategy, fostering good financial habits, avoiding debt, saving for investments, and setting aside emergency funds (Bùi Thị Ngọc Anh, 2020) According to Xiao (2006), the financial management behaviors, known as the FMBS scale, encompass four key areas: spending management, credit management, savings management, and investment and insurance management, each characterized by specific behaviors Spending management involves comparing shops, paying bills on time, reviewing bills, and adhering to a budget Credit management focuses on paying off credit cards, utilizing credit limits wisely, and making minimum loan payments Savings and investment management includes maintaining an emergency fund, saving from monthly income, planning for long-term goals, preparing for retirement, and investing Notably, the study did not address insurance management, which covers obtaining adequate life, property, and health insurance.
Mastering these skills is particularly crucial for students as they transition to financial independence Good personal financial management allows students to balance their
15 academic pursuits and financial obligations effectively, ensuring they can handle emergencies without falling into debt (OECD, 2020)
2.1.1.2 The importance of personal financial management skills
In today's digital transformation era, mastering personal financial management is crucial for students, as the rise of digital financial tools and online payment systems presents both opportunities and challenges While these innovations offer convenience, they also bring risks like cybersecurity threats, impulsive spending, and reliance on high-interest loans Unfortunately, many students lack the financial literacy required to navigate these tools effectively, resulting in financial stress and potential long-term economic repercussions (Lusardi and Tufano, 2015).
Many students face challenges in managing their finances due to a lack of financial literacy, poor budgeting skills, and impulsive spending The pressure of juggling part-time jobs, academic duties, and social life exacerbates their financial stress, which can adversely affect their mental health, academic success, and overall well-being.
2017) Additionally, rising education costs further underscore the importance of budgeting wisely, seeking scholarships, and effectively managing student loans
Utilizing digital financial tools, such as mobile banking apps and AI-driven advisory services, can enhance students' financial management skills by offering personalized insights for optimizing their financial plans These resources enable students to effectively track expenses, automate savings, and make informed investment choices However, a lack of financial literacy may result in the misuse of these tools, potentially leading to overspending and increased debt.
Digital financial tools are essential not only for facilitating transactions but also for improving students' financial literacy and independence AI-driven applications and online platforms deliver personalized financial insights, enabling students to refine their spending and saving habits Additionally, these resources offer access to financial education and advisory services, empowering students with the knowledge needed to make informed financial choices.
2.1.1.3 Use of digital financial tools
The rapid growth of mobile wallets can be attributed to their intuitive interfaces and the favorable user experiences they offer Studies indicate that factors such as perceived ease of use and perceived usefulness play a crucial role in shaping consumer trust and driving adoption rates.
2020) Financial institutions emphasize these advantages through marketing campaigns that highlight the convenience and security of digital financial tools (Carlos Flavián, 2006)
The growing familiarity with smartphones has significantly accelerated the adoption of mobile payments, as users find these technologies intuitive and easy to use Research indicates that first-time users are more inclined to continue utilizing mobile payment platforms upon recognizing their security, widespread availability, and efficiency Additionally, digital financial tools promote financial stability by offering real-time expense tracking and supporting informed financial decisions By utilizing these technologies, students can cultivate responsible financial habits that enhance their long-term financial well-being.
Digital financial literacy (DFL) extends beyond basic financial knowledge, focusing on the ability to utilize digital tools for effective financial management and decision-making In today's digital landscape, DFL encompasses skills for engaging with online financial systems, including safe and efficient online shopping and the use of e-commerce platforms It emphasizes the adoption of non-cash payment methods, such as e-wallets and digital payment gateways, while also highlighting the importance of online banking for account management and personal finance tracking Furthermore, DFL involves understanding digital financial services, navigating various financial tools, and protecting oneself from digital fraud.
Digital financial literacy is essential in today's world, where financial services are mainly accessed through digital platforms (Prasad et al., 2018) Its importance has been underscored during events like demonetization The rapid advancement of digital payment systems and mobile communication technologies has created new opportunities to provide low-income households with affordable and reliable financial tools through mobile devices and digital channels This evolution has enabled previously unbanked individuals to access financial services that were once inaccessible to them.
Research by Abdallah et al (2024) indicates that individuals with higher digital financial literacy (DFL) are more likely to engage in responsible financial behaviors such as effective budgeting, regular saving, and avoiding excessive debt, while also enhancing their confidence in making financial decisions on digital platforms A study in Vietnam corroborates this by showing that individuals with strong digital financial skills are more inclined to trust and utilize mobile banking services, thereby improving their financial management capabilities (Phan et al., 2024) Additionally, the OECD (2018) highlights the crucial role of DFL in promoting financial inclusion by equipping individuals with the skills necessary to access digital financial services, which can help diminish barriers to credit, savings, and insurance for underserved populations, while also mitigating risks related to digital fraud and financial scams.
As students increasingly engage with digital financial platforms like online banking and e-wallets, mastering digital financial literacy (DFL) becomes essential for safe and effective navigation A lack of DFL can result in poor financial choices, heightened susceptibility to fraud, and overall financial instability Conversely, equipping students with strong DFL enhances their financial management skills, fostering improved budgeting, saving, and investing practices Financial literacy empowers students to manage their finances adeptly and mitigate significant risks, including credit card debt and online fraud.
Family and social backgrounds significantly influence students' financial values, habits, and attitudes According to Xiao and Porto (2017), family and friends play a crucial role in shaping financial understanding and behaviors, including saving, spending, and debt management These influences provide essential financial knowledge, share practical experiences, and instill financial values from an early age.
Family serves as the primary educational environment, profoundly shaping students' financial awareness and behaviors Research by Anh et al highlights the substantial influence of parental guidance on the spending management habits of Vietnamese students Additionally, studies by Shim et al (2010) reveal that parents, along with work experience and financial education received during adolescence, significantly affect young adults' financial knowledge, attitudes, and behaviors Notably, parental influence is identified as the most impactful factor among these elements.
Parental influence plays a crucial role in shaping children's financial habits, often surpassing both work experience and formal financial education Through role modeling and direct teaching, parents impart essential principles like budgeting, saving, and responsible consumption Research indicates that individuals' financial behaviors are largely reflective of their family's practices during childhood, with disciplined financial management leading to better personal finance skills Furthermore, studies show that family financial education significantly enhances students' ability to create personal financial plans Those who receive financial knowledge and skills from their families are generally more adept at managing their finances, while parental encouragement and education further boost financial literacy and personal financial management skills.
Previous studies
Research by Kharchenko (2021) indicates that women generally exhibit lower financial literacy levels than men, with significant differences observed based on education Individuals with higher education levels demonstrate notably better financial knowledge compared to their less educated counterparts.
Research indicates that older adults often exhibit less diligence in credit management and possess weaker savings skills compared to younger individuals, such as freshmen (Xiao, 2006) Additionally, students who benefit from financial guidance provided by their families are more likely to develop stronger financial management skills than those who lack such support (Shim et al., 2010).
Research indicates that students in rural areas demonstrate lower financial literacy levels than those in urban settings (Cole et al., 2013) Conversely, a study by Sabri et al (2010) reveals that students residing in dormitories possess higher financial literacy compared to their peers who do not live in dorms.
A study by Salsabilla (2022) aimed to analyze the effects of family financial education, financial literacy, peers, and a hedonistic lifestyle on personal financial management The analysis, based on 100 survey responses, revealed that while family financial education did not influence students' financial management, financial literacy, peer influence, and a hedonistic lifestyle positively impacted their personal financial management.
A study by Anh (2019) assessed the influence of financial literacy on students' spending management through three perspectives: financial attitudes, financial knowledge, and financial behavior Analysis of 1,131 valid responses revealed that financial literacy and financial attitudes did not significantly affect spending management In contrast, financial behavior and parental influence emerged as key factors, with financial behavior demonstrating the most pronounced impact.
According to Trần Thị Mai Ly (2023), determined that there are three factors that influence students' personal financial management skills: (1) Financial attitudes, (2) Financial influence from parents, (3) Financial knowledge
Bùi Thị Ngọc Anh (2020) highlights that effective personal financial management skills (PFMS) are essential for students to manage their income and expenses, avoid debt, and reduce financial stress These skills enable students to create savings and investment plans, establishing a strong foundation for achieving financial goals after graduation Financial literacy is vital for making informed spending and investment decisions, thereby maximizing economic benefits A regression analysis of business administration students at Hanoi University of Industry identified three key factors influencing PFMS: financial awareness, learning environment, and personal motivation.
Financial attitudes play a crucial role in personal financial management, with family financial education and financial knowledge being key contributors According to Huong (2024b), conscious spending habits are the most significant factor influencing students' financial management, while peer support does not significantly impact financial management practices.
A study by Lê Thị Hồng Hạnh (2023) identifies five key factors influencing students' understanding and skills in personal financial management, ranked from highest to lowest: (1) finance classes, (2) family education and part-time jobs, (3) clubs focused on personal financial management, (4) personal financial knowledge, and (5) academic major Additionally, demographic factors such as gender, area of growth, and place of residence reveal variations in personal financial management skills among students at Hong Bang University.
Lê Long Hậu (2019) identified key factors influencing students' personal budget management skills, specifically their savings and spending management abilities The study revealed that gender, course of study, part-time employment, parental financial guidance, and financial knowledge positively impacted these skills Notably, living with family enhanced spending management skills but did not affect savings management Conversely, attending financial management classes had a negative impact on both skills Additionally, the research found variations in savings management skills among students from different courses and majors, while spending management skills showed no significant differences across these groups.
A study involving 492 students from Quy Nhon University reveals that family financial education, financial literacy, and controlled spending styles significantly enhance students' personal financial management Interestingly, the research indicates that peer support does not influence students' financial management practices The findings offer valuable insights and practical implications for the topic at hand (Huong, 2024a).
Despite significant research on personal financial management skills (PFMS) in students, notable gaps persist, especially regarding digital transformation Current studies yield inconsistent results about the effects of financial literacy and family financial education on PFMS, with some findings indicating potential influences, as highlighted by Salsabilla (2022).
Research on family financial education shows mixed results; while some studies (Huong, 2024a; Lê Thị Hồng Hạnh, 2023) suggest positive effects, others indicate no significant influence Similarly, findings by Anh (2019) and Trần Thị Mai Ly (2023) reveal no notable relationship between financial literacy and spending management, contrasting with the positive correlation reported by Salsabilla (2022) and Huong (2024a) These discrepancies highlight the necessity for further exploration into the interplay between financial literacy, family financial education, and digital financial tools in shaping personal financial management systems (PFMS).
A significant gap in research exists regarding the exploration of digital financial tools within Personal Financial Management Systems (PFMS) Previous studies, such as those by Kharchenko (2021), Cole et al (2013), and Sabri et al (2010), have predominantly concentrated on traditional financial literacy, overlooking the adoption and use of digital financial applications like mobile banking and automated expense management tools by students Although Handarkho (2020) has investigated the use of mobile wallets and cashless payment systems, there remains a scarcity of empirical evidence on how these digital tools improve students' financial decision-making and management behaviors.
The role of digital financial literacy and behavioral factors in personal financial management systems (PFMS) is still largely underexplored While studies by Bùi Thị Ngọc Anh (2020) and Lê Long Hậu (2019) highlighted financial awareness, learning environments, and financial attitudes as essential determinants, they overlooked the crucial aspect of digital financial literacy, which is increasingly vital in today's financial landscape Furthermore, Salsabilla (2022) investigated the effects of peer support and hedonistic lifestyles but failed to consider the moderating role of digital financial literacy There is also a significant gap in understanding how digital budgeting tools and automated savings mechanisms influence conscious spending behaviors among students.
Previous research has primarily focused on traditional financial management theories, emphasizing financial attitudes, behaviors, and knowledge (Trần Thị Mai Ly, 2023; Lê Long Hậu, 2019) However, these studies often overlook the impact of financial technology adoption, cybersecurity awareness, and digital financial literacy on personal financial management systems (PFMS) As financial technology continues to evolve rapidly, there is a pressing need for a comprehensive research framework that integrates traditional financial management theories with contemporary digital financial behavior models.
To address these gaps, this study will:
- Investigate the role of digital financial literacy and digital financial tools in PFMS;
- Examine the financial influence of family and society in shaping PFMS
- Assess the relationship between financial behavior and PFMS Especially in the adoption of digital financial tools
- Assess students’ financial management attitudes when applying digital technology to PFMS
Theory background
The Technology Acceptance Model (TAM), developed by Davis in 1989, serves as a key theoretical framework for understanding technology acceptance behavior This behavior is influenced by attitudes shaped by two primary factors: Perceived Usefulness (PU) and Perceived Ease of Use (PEOU) These factors are crucial in determining an individual's intention to adopt and utilize technology effectively.
The Technology Acceptance Model (TAM) posits that technology perceived as easy to use and beneficial positively influences users' attitudes, thereby increasing their intention to adopt and use the technology (George and Kumar, 2013) User-friendly technology is essential in shaping users' behaviors and translating their intentions into actual usage Perceived usefulness (PU) reflects the belief that a system enhances performance, while ease of use indicates the perception that minimal mental effort is required to operate the system (Davis, 1989).
The Technology Acceptance Model (TAM) has been extensively utilized in personal financial management research, particularly during the digital transformation era, where tools like e-wallets and digital banking applications are gaining traction Studies, such as Amin (2009), demonstrated that perceived usefulness (PU) and perceived ease of use (PEOU) significantly influence users' intentions to adopt mobile banking in Malaysia Similarly, research by George and Kumar (2013) highlighted that PU enhances personal financial management efficiency and fosters a positive user experience in online banking In Vietnam, Nguyen (2022) applied TAM to evaluate e-wallet acceptance among students, revealing that perceived convenience and ease of use are crucial for improving personal financial management skills Collectively, these studies validate TAM's relevance in financial management and underscore the importance of integrating innovative financial technologies to enhance personal finance capabilities in the digital age.
This study's research model implicitly highlights the relevance of Technology Usefulness and Technology Ease of Use within the digital financial management context, despite not explicitly referencing them The Technology Usefulness aspect from the Technology Acceptance Model (TAM) emphasizes individuals' beliefs about technology enhancing their efficiency This is evident in the questionnaire, where students express whether mobile banking apps, digital wallets, and expense-tracking applications aid in effective financial management Questions about the assistance these digital tools provide in budgeting, saving, and investment planning further illustrate their perceived benefits in financial decision-making Additionally, inquiries into how digital tools enhance financial awareness underscore students' recognition of technology's practical advantages in managing finances Consequently, these findings suggest that students are actively adopting digital financial tools, integrating them into their financial behaviors based on their perceived usefulness.
Technology Ease of Use significantly impacts digital adoption, particularly in financial applications The Technology Acceptance Model (TAM) incorporates this aspect by including questions that evaluate the accessibility and simplicity of mobile banking interfaces and financial management tools These inquiries emphasize the critical role of intuitive design and easy navigation in promoting the adoption of financial technology among users.
Students' willingness to embrace and adapt to new digital financial tools highlights their capability to navigate an evolving financial landscape This study emphasizes the significance of both adopting and adapting to financial technologies, illustrating how students incorporate digital solutions into their financial management while staying responsive to ongoing technological advancements.
Hypothesis development
2.4.1 Digital financial literacy and personal financial management skills
Digital financial literacy (DFL) refers to the essential skills and knowledge required to effectively use digital financial tools and services, such as online banking and electronic payments It enhances individuals' ability to make informed financial decisions in a tech-driven world (Lusardi and Mitchell, 2014) For students, DFL aids in budgeting and expense tracking through technological solutions, simplifying the financial decision-making process Consequently, students with greater digital financial literacy are likely to achieve better personal financial management skills (PFMS).
H1: Digital financial literacy positively influences personal financial management skills 2.4.2 Family and social background and personal financial management skills
Family and social upbringing play a crucial role in shaping students' financial attitudes and behaviors Parents act as role models, instilling essential money management skills and spending habits from an early age, which fosters a strong foundation for financial literacy Additionally, a supportive social environment and healthy relationships with peers contribute to students' positive financial management skills (PFMS) Consequently, those raised in nurturing family and social contexts are more likely to benefit from positive reinforcement and enhanced access to financial knowledge, leading to better financial outcomes (Joo and Grable, 2004).
H2: Family and social background positively influence personal financial management skills
2.4.3 Financial management attitude and personal financial management skills
Financial management attitudes reflect an individual’s mindset and approach to managing money Positive attitudes toward financial management include proactive behaviors, such
Effective budgeting, planning, and goal-setting are crucial for financial management, as highlighted by Joo and Grable (2004) Studies indicate that individuals with a positive financial mindset are more inclined to demonstrate disciplined financial behaviors, leading to greater financial stability (Hira and Mugenda, 1999).
H3: Financial management attitude positively personal financial management skills 2.4.4 Financial behavior and personal financial management skills
Financial behavior involves managing money through actions like saving, investing, spending, and borrowing Adopting positive financial habits, such as consistent saving and responsible borrowing, is essential for enhancing financial well-being Those who practice these behaviors are more capable of navigating financial difficulties and making informed choices.
Research indicates that financial behavior significantly impacts personal financial management skills (PFMS), showcasing the application of financial knowledge and attitudes (Atkinson and Messy, 2012) Encouraging positive financial behaviors among students from an early age establishes a strong foundation for their long-term financial success, enabling them to manage their educational and personal expenses effectively.
H4: Financial behavior positively influences personal financial management skills
Concept framework
RESEARCH METHODOLOGY
Survey and questionnaire design
A survey, typically conducted via a questionnaire, is a systematic method for gathering information aimed at uncovering patterns and relationships among different phenomena A notable feature of surveys is their capacity to collect data from various sources at once, providing a timely overview of trends (De Vaus, 2001; Bell et al., 2022).
This method offers a significant cost advantage, allowing researchers to efficiently collect data in a brief period However, if a questionnaire is poorly designed or administered, it can create substantial issues, especially the potential for respondents to misinterpret questions, thereby jeopardizing the validity of the data (Johnson and Turner, 2003).
The questionnaire aimed to gather insights into individuals' technical financial knowledge, financial behaviors, management attitudes, and their digital family and social backgrounds, focusing on various financial issues prevalent in Vietnam.
To enhance the validity of the measures and facilitate comparisons with previous research, the study adapted its measures from existing surveys The questionnaire was divided into five sections: Demographics, Family and Social Background, Digital Financial Literacy, Financial Behavior (which includes Digital Savings, Digital Spending, Digital Investment Behavior, and Credit Behavior), and Financial Management Attitude Careful attention was given to ensure that all items in the questionnaire were clear and easily understood by respondents.
This section aims to gather essential demographic information from respondents, such as gender, income, education level, year of study, field of study, and their usage of online applications for saving, investing, or spending This data enables researchers to create a detailed profile of the respondents.
Section 2: Family and Social Background
This section explores the family background, living environment, and relationships with friends that shape financial management skills;
This section collects information on aspects of DFL such as knowledge, awareness, experience, and skills;
This section collects financial behaviors such as digital saving, digital spending and digital investing to examine how digital behaviors will impact students' personal financial management skills;
This section assesses students' attitudes towards financial management, through budgeting, spending control and debt.
Sample and data collection
The study focused on students living and studying in Vietnam, with the author distributing a questionnaire directly and via social media platforms such as Facebook and Zalo The research purpose was clearly communicated to participants, ensuring their anonymity Ultimately, a total of 279 valid responses were collected for analysis.
Measurement
To evaluate the factors influencing students' personal financial management skills in the digital era, a multi-item scale was utilized, with each construct assessed through a series of statements rated on a five-point Likert scale (Bryman and Bell, 2007) The formal research model identified five key influencing factors and included 49 observed variables, which were systematically recoded for analysis.
FSB1 My family often discusses financial topics such as saving, investing,
FSB2 My parents have positively influenced my approach to managing money
(Huong, 2024b); (Lê Thị Hồng Hạnh,
FSB3 I have family support in using financial tools such as e-wallets, credit cards or online banking
FSB4 My family is willing to support me financially when I am in trouble
FSB5 A family's financial circumstances impact their capacity to utilize digital financial tools like e-wallets, online banking, and credit cards
FSB6 I attend financial training courses/clubs/seminars to improve my financial management skills
FSB7 My friends' lifestyles greatly influence my financial decisions (e.g saving, investing, spending, etc.)
FSB8 I often follow financial or purchasing advice shared by influencers on social media platforms (eg: Instagram, Tiktok, Facebook, Threads, Youtube,
DFL1 I can proficiently search for information online using my digital devices (e.g
DFL2 I understand lending, saving, and investment models on digital platforms
DFL3 I am familiar with digital payment solutions, including E-Debit, E-Credit, E-
Money, Mobile/Internet Banking, and e- wallets
DFL4 I possess strong expertise in managing digital assets
DFL5 I am knowledgeable about customer rights and protections in digital financial transactions, as well as the process for filing complaints in case of issues
DFL6 I pay bills like electricity, tuition, etc through digital payment products
DFL7 I am aware of the risks of online financial fraud when using digital financial tools
DFL8 I always take proactive measures to protect my personal information online (e.g create strong passwords, use biometrics, etc.)
DFL9 Security risks make me hesitant to use digital financial tools
DFL10 I effectively manage my financial activities using digital platforms, such as monitoring expenses and overseeing transaction fees
DFL11 I am good at handling error situations when transacting financially on digital platforms
FMA1 I always track and control my monthly expenses (Shim et al., 2010); (Huong, 2024b) FMA2 I always stay within my budget
FMA3 I usually calculate and think carefully before deciding to buy the items I like
FMA4 I rarely have debts at the end of the month
Behavior Digital Spending Behavior (Setiawan et al., 2022); (Oquaye et al., 2022); (Furinto et al., 2023); (Lê Thị Hồng Hạnh,
FB1 I usually prefer shopping on digital platforms such as Shopee, Lazada, or Tiktok Shop, rather than utilizing traditional options like markets, supermarkets, or shopping malls
FB2 I tend to make impulsive financial decisions (e.g spending on unnecessary items)
FB3 I easily spend more than planned when using e-wallets, credit cards (Momo, Visa, SPayLater, )
FB4 I ensure that all my bills, including electricity, water, and internet, are paid promptly
FB5 I have awareness of personal financial management when using digital financial tools to save
FB6 I have regular savings using digital financial products
FB7 Using digital financial products helps me be more motivated to save
FB8 I buy bonds/stocks/mutual funds or invest through an investing app
FB9 I believe that using digital applications for investment is relatively secure, both in terms of financial safety and data protection
FB10 I get the best benefits when investing through digital investment apps
FB11 I frequently surpass the withdrawal limit on one or more of my ATM cards
FB12 When I use a credit card, I always pay it on time
PFMS1 I am capable of making financial decisions using available information and advanced digital financial tools
PFSM2 The way I manage my finances allows me to enjoy life
PFMS3 I have the ability to control my personal finances and effectively handle unexpected financial situations
PMS4 The way I manage my money using digital financial products today has a positive impact on my future.
Data processing and analysis methods
Based on the information found on websites, theses, scientific research, the author has:
- First, based on existing research, the topic builds a model of factors affecting students' financial management skills;
- Proceed to create a preliminary questionnaire to conduct a pilot survey on a few students
Based on the preliminary research results, I will adjust the questionnaire appropriately, remove unnecessary items, add practical questions so that the surveyors can understand and give the most accurate results
The research leverages secondary data through analysis, statistical evaluation, description, and data visualization to emphasize the survey sample's characteristics based on the personal attributes reported by respondents.
3.4.3 Testing the reliability of the scale
The Cronbach's alpha coefficient in SPSS serves as an essential tool for assessing scale reliability and identifying inappropriate observed variables in research (Nguyễn, 2011) By eliminating junk variables and unrealistic factors, researchers can enhance the integrity of their models Conversely, variables with higher Cronbach's Alpha coefficients indicate greater reliability of the scale.
Validating a scale in research involves ensuring unidimensionality and achieving a Cronbach's Alpha reliability of 0.7 or higher (Hair et al., 2010) In academic contexts, items with a total correlation coefficient below 0.3 and a Cronbach's alpha below 0.6 are typically discarded Scales with a Cronbach's alpha between 0.6 and 0.7 are considered usable, while those ranging from 0.7 to 1.0 are deemed good (Nguyễn, 2011) This study aims to validate the scale concerning the factors influencing PFMS as the independent variable and PFMS as the dependent variable.
Exploratory Factor Analysis (EFA) is a statistical method used to simplify and categorize groups of factors, facilitating the reevaluation of observed variable scales This technique helps identify sets of variables with similar traits while eliminating less significant observed variables from the analysis.
The Kaiser-Meyer-Olkin (KMO) measure is used to assess whether factor analysis is appropriate A KMO value ranging from 0.5 to 1.0 signifies suitability for the analysis,
36 while a value below 0.5 indicates that the data is not suitable for the model (Hair et al.,
In addition to evaluating the KMO value, it's essential to analyze the Bartlett test to assess the correlation among observed variables A statistically significant result (Sig < 0.05) from the Bartlett test indicates a correlation between the variables in the model.
In exploratory factor analysis (EFA), the Eigenvalue index is crucial for determining the number of factors required for a study, alongside the KMO and Bartlett values Factors with Eigenvalues greater than 1.0 are retained in the model, as they effectively summarize the information of the variables.
Factor loading is a key metric for validating the significance of Exploratory Factor Analysis (EFA) results, with its coefficient influenced by sample size and research objectives In this study, a sample size of 279 requires a factor loading coefficient greater than 0.5 The Rotated Component Matrix, an essential component of the EFA analysis, displays these factor loading values, showcasing variables standardized across different factors.
Correlation analysis is a method for assessing the relationships between dependent and independent variables, as well as among independent variables themselves, represented by two key values.
- Sig (2-tailed) value < 0.05 has statistical significance showing that the variables are correlated with each other
- Pearson correlation coefficient shows the level of linear correlation between pairs of observed variables in the model Pearson coefficient is determined in the case of Sig value
< 0.05 The value of the coefficient runs from 1 to -1 With coefficient > 0, there is a positive correlation between the two variables and vice versa (Cohen, 2013)
The linear regression analysis model is employed to assess the impact of various factors on work motivation (Nguyễn, 2011) If the adjusted model indicates a significance level (Sig.) below 0.05, the study will continue with regression analysis to evaluate the degree of influence.
37 direction of the factors' influence on students' personal financial management skills in the digital era
The linear regression function has the form:
- Y is personal financial management skills;
- β is the coefficient of the factors;
- X1, X2, X3, Xn are the factors of the model To ensure the reliability of the regression function, the study will use the following tests in the regression results from SPSS 22 software:
The adjusted R coefficient provides a more accurate measure of a model's explanatory power compared to R square, as it avoids overstatement According to Hair et al (2010), an R value of approximately 0.75 is considered good, 0.5 is significant, and 0.25 is weak In the context of Vietnam, an adjusted R value greater than 0.5 is deemed favorable for regression analysis (Nguyễn, 2011).
ANOVA analysis requires evaluating the F and Sig values, where a Sig value below 0.05 indicates that the factor is suitable for inclusion in the regression model; factors with higher Sig values will be excluded.
The coefficients analysis includes three essential values: the standardized coefficient (Beta), the unstandardized coefficient (β), and the VIF coefficient The β coefficient indicates the impact on the dependent variable for each unit change in an independent variable, with a Beta greater than 0 signifying a positive effect Additionally, a VIF value below 4 confirms the absence of multicollinearity (Pan & Jackson, 2008).
DATA ANALYSIS AND RESEARCH FINDINGS
Descriptive statistic
The survey results reveal a notable gender imbalance among respondents, with 67.4% identifying as female and 32.3% as male, alongside one individual identifying as another gender A significant majority, 83.5%, were undergraduate students, while graduate, college, and intermediate students comprised a smaller segment The largest groups by academic year were first- and fourth-year students, with second-, third-, and fifth-year students, as well as recent graduates, making up the rest Regarding living arrangements, nearly half (49.8%) resided in rented accommodations within the city, while others lived with family or in dormitories in both urban and suburban settings.
Income distribution among respondents reveals that 56.6% earn between VND1 million and VND5 million, with fewer individuals earning below VND1 million or above VND20 million Spending patterns indicate that 42.3% allocate 50%-70% of their income to expenses, while only 7.5% spend less than 30% A significant majority, 58.8%, are students majoring in economics and finance, while a smaller group focuses on information technology or other disciplines Digital financial tools are well-recognized, with 34.1% actively using them for saving, investing, and expense management, while 41.9% are aware of these tools but do not utilize them Among digital financial applications, Momo stands out as the most popular, with 202 users, followed closely by Zalo Pay.
(105) and Shopee Pay (44) When faced with financial shortfalls, 63.4% of students borrowed from friends, while others relied on family support, credit cards or pay advances
Graduated in less than 6 months
In the city, with family 56 20.1
In the city, staying in a dormitory 20 7.2
In the suburbs, with family
In the suburbs, staying in a dormitory
From 1 million to 5 million VND
From 5 million to 10 million VND 57 20.4
Use digital services to manage income and expense
Know but did not use 117 41.9
Not knowing so did not use
Trends in living cost shortages
Ask for money from relatives or family
Source: Results of analysis from survey data 4.1.2 Variables’ descriptive statistics
Descriptive statistics Code Mean Std
Theoretical Range Family and Social Background
My family often discusses financial topics such as saving, investing,
My parents have positively influenced my approach to managing money
I have family support in using financial tools such as e-wallets, credit cards or online banking
My family is willing to support me financially when I am in trouble
A family's financial circumstances impact their capacity to utilize digital financial tools like e-wallets, online banking, and credit cards
I attend financial training courses/clubs/seminars to improve my financial management skills
My friends' lifestyles greatly influence my financial decisions
I often follow financial or purchasing advice shared by influencers on social media platforms (eg:
I can proficiently search for information online using my digital devices (e.g
I understand lending, saving, and investment models on digital platforms
I am familiar with digital payment solutions, including E-
I possess strong expertise in managing digital assets
I am knowledgeable about customer rights and protections in digital financial transactions, as well as the process for filing complaints in case of issues
I pay bills like electricity, tuition, etc through digital payment products
I am aware of the risks of online financial fraud when using digital financial tools
I always take proactive measures to protect my personal information online (e.g create strong passwords, use biometrics, etc.)
Security risks make me hesitant to use digital financial tools
I effectively manage my financial activities using digital platforms, such as monitoring expenses and
I am good at handling error situations when transacting financially on digital platforms
I always track and control my monthly expenses
I always stay within my budget
I usually calculate and think carefully before deciding to buy the items I like
I rarely have debts at the end of the month
I usually prefer shopping on digital platforms such as
Tiktok Shop, rather than utilizing traditional options like markets, supermarkets, or shopping malls
I tend to make impulsive financial decisions (e.g
I easily spend more than planned when using e-wallets, credit cards (Momo, Visa,
I ensure that all my bills, including electricity, water, and internet, are paid promptly
I have awareness of personal financial management when using digital financial tools to save
I have regular savings using digital financial products
Using digital financial products helps me be more motivated to save
I buy bonds/stocks/mutual funds or invest through an investing app
I believe that using digital applications for investment is relatively secure, both in terms of financial safety and data protection
I get the best benefits when investing through digital investment apps
I frequently surpass the withdrawal limit on one or more of my
When I use a credit card, I always pay it on time
I am capable of making financial decisions using available information and advanced digital financial tools
The way I manage my finances allows me to enjoy life
I have the ability to control my personal finances and effectively handle unexpected financial situations
The way I manage my money now has a positive impact on my future
Source: Results of analysis from survey data
An evaluation of the measurement model
4.2.1 Assessing reliability of the constructs
The reliability of the scales was evaluated using the Cronbach's Alpha (α) coefficient, with all scales demonstrating strong reliability (α ≥ 0.7) Specifically, the FSB scale showed α
= 0.876, indicating good internal consistency among its variables Similarly, the DFL and
The FB scales demonstrated high reliability with Cronbach's Alpha values of 0.883 and 0.889, while the FMA scale recorded α = 0.874 and the PFMS scale α = 0.829, all meeting established reliability criteria These results confirm that the scales are reliable and appropriate for subsequent analyses, including exploratory factor analysis (EFA) and regression analysis, aimed at exploring the factors that influence personal financial management skills.
Source: Results of analysis from survey data 4.2.2 Exploratory factor analysis
The study utilized Principal Component Analysis (PCA) for factor extraction in the EFA process, employing Varimax rotation to categorize the factors Initially, six factor groups were identified, but variables FB1, FB4, FB5, DFL9, and DFL11 were found to be structurally inconsistent, not aligning with the expected factors Consequently, these variables were removed, and a second round of EFA was performed.
The second analysis demonstrated a KMO coefficient of 0.940, indicating excellent data suitability for exploratory factor analysis (EFA), with a Bartlett test significance level of 0.000 The total explained variance was 64.007%, exceeding the 50% threshold and highlighting the model's effectiveness in capturing data variation Additionally, the rotated component matrix identified four factor groups, with variables showing high loadings (≥ 0.5), confirming their reliability and meaningful contribution to the identified factors.
Table 4.4: KMO and Bartlett’s Test (Independent variable) KMO measure of Sampling Adequacy 0.940
Source: Results of analysis from survey data
Source: Results of analysis from survey data
The PFMS scale consists of four observed variables, and after assessing reliability with Cronbach's alpha, the study evaluated their convergence The results indicated that the EFA factor analysis was appropriate, with a KMO coefficient of 0.807, surpassing the 0.5 threshold, and a significance level of 0.000 The analysis explained 66.136% of the total variance, with all variables showing high factor loadings, confirming strong convergence Consequently, a single factor was extracted, effectively representing the PFMS scale among students.
Table 4.6: KMO and Bartlett’s Test (Dependent variable) KMO measure of Sampling Adequacy 0.807
Source: Results of analysis from survey data
Source: Results of analysis from survey data 4.2.3 Correlation analysis
The results show that all correlations are statistically significant at the 0.01 level (p < 0.01), demonstrating that the factors in the model are significantly related to each other
The FSB factor shows a significant correlation with DFL (r = 0.514) and PFMS (r = 0.503), highlighting the crucial influence of family and social background on enhancing financial knowledge and cultivating financial management skills.
FB (r = 0.379) and FMA (r = 0.362) also shows the moderate influence of social factors on individual behavior and attitudes
Digital financial literacy (DFL) shows a moderate to strong correlation with personal financial management skills (PFMS), with a correlation coefficient of r = 0.490, highlighting its significance in enhancing financial skills Furthermore, DFL also exhibits moderate correlations with financial behavior (FB) at r = 0.392 and financial management attitudes (FMA) at r = 0.351, underscoring the critical role of knowledge in fostering positive financial behaviors and attitudes.
FB demonstrated the highest correlation with PFMS (r = 0.594), highlighting the significant impact of financial behavior on enhancing financial management skills Likewise, FMA showed a strong correlation with PFMS (r = 0.502), reinforcing the idea that positive attitudes toward financial management play a crucial role in developing financial skills.
The findings reveal a significant correlation among the factors in the model, highlighting that financial behavior and attitudes towards financial management are key in enhancing personal financial management skills This underscores the importance of financial education, as well as the support from family and society, in promoting effective personal financial management.
FSB DFL FB FMA PFMS
** Correlation is significant at the 0.01 level (2-tailed)
Source: Results of analysis from survey data 4.2.4 Linear regression analysis
The regression analysis results, as shown in Table 4.23, reveal a strong multivariate correlation coefficient (R = 0.715) between the independent variables (FSB, DFL, FB, FMA) and the dependent variable (PFMS), indicating a robust relationship The coefficient of determination (R² = 0.511) demonstrates that 51.1% of the variation in PFMS is accounted for by the independent variables, showcasing significant explanatory power Additionally, the adjusted coefficient of determination (Adjusted R² = 0.503) confirms that the model retains a good fit and explanatory capability, even when considering the number of predictors and sample size.
The standard error of the estimate is 0.53013, reflecting the discrepancy between actual values and model predictions This acceptable value suggests that the prediction error is relatively minor.
The Durbin-Watson statistic, measured at 1.652, indicates no autocorrelation in the residuals, as a value close to 2 suggests their independence This finding enhances the reliability and validity of the regression model.
Std Error of the Estimate
Source: Results of analysis from survey data
The multiple linear regression analysis results indicate a highly statistically significant model, with independent factors such as FSB, DFL, FB, and FMA significantly influencing PFMS Notably, the standardized regression coefficient reveals that FB (Beta = 0.363) exerts the most substantial impact on PFMS, closely followed by FMA.
The study highlights the significant role of financial behavior in enhancing personal financial management skills, with FSB, DFL, and other factors showing notable impact (Beta values of 0.227, 0.198, and 0.167 respectively) All t-values are significant (Sig < 0.001), reinforcing the model's reliability Additionally, the multicollinearity test indicates stability, with tolerance between 0.676 and 0.772 and VIF ranging from 1.295 to 1.479, mitigating multicollinearity risks Overall, the model effectively explains variations in personal financial management skills, underscoring the importance of knowledge, behavior, attitude, and social factors.
Source: Results of analysis from survey data 4.2.5 Independent Sample Test
The Independent Samples Test revealed no statistically significant difference in financial management skills (PFMS) between men and women, as indicated by Levene's Test for homogeneity of variances, which yielded a value of Sig = 0.907 (greater than 0.05) Consequently, the assumption of equal variances was met, and the test value of t = 1.187 with a Sig (2-tailed) of 0.236 (also greater than 0.05) confirmed that the mean PFMS scores for both genders were comparable.
The analysis revealed a mean difference of 0.11294 between the two groups, with a 95% confidence interval ranging from -0.07432 to 0.30021, which includes zero This finding underscores that the difference is not statistically significant, indicating that gender did not have a meaningful impact on financial management skills (PFMS) in this study.
Levene’s Test for Equality of Variances
T-test for Equality of Means
95% Confidence Interval of the Difference
Source: Results of analysis from survey data
Results
The One-Way ANOVA and Independent samples T-test revealed that demographic factors such as gender, education level, income, area of residence, and years of education do not significantly influence personal financial management skills.
The author's research reveals a notable divergence from earlier studies regarding the influence of demographic factors on personal financial management skills Unlike Kharchenko (2021), who claimed that women are typically less financially literate than men, this study found no significant gender differences Additionally, while Kharchenko (2021) and Cole et al (2013) suggested that higher education levels correlate with better financial skills, the current findings indicate that these demographic factors do not significantly affect financial management abilities.
Research indicates that 56% of Vietnamese students exhibit varying levels of financial literacy, with studies by Xiao (2006) and Sabri et al (2010) suggesting that freshmen tend to be more cautious in credit management Additionally, students residing in dormitories demonstrate higher financial literacy compared to their peers living off-campus However, the current study did not find significant differences in financial literacy based on academic year or housing situation, contrasting with previous findings by Shim et al.
Research indicates that students who receive financial guidance from their families exhibit superior financial management skills compared to those who lack such support This finding aligns with the author's study, highlighting the positive influence of family and social background on students' personal financial management abilities Ultimately, it underscores the crucial role of family guidance in fostering essential financial skills among students.
The characteristics of Vietnamese students in the context of digital transformation highlight that digital financial tools are diminishing the influence of demographic factors Additionally, the limitations of the sample size in this study may impact the findings These results provide a fresh perspective on the personal financial skills of Vietnamese students, differing from earlier international studies, and pave the way for future research on non-demographic influences.
The research identifies four key factors influencing students' personal financial management skills: family and social background, digital financial knowledge, financial behavior, and financial management attitude The findings align with previous studies while highlighting the critical role of digital financial literacy and financial behavior in developing these skills Consistent with earlier research, financial behavior emerges as the most significant determinant of effective financial management This study further emphasizes the importance of digital financial literacy, revealing that students with higher levels of this literacy exhibit better financial management skills by effectively using digital tools like mobile banking, e-wallets, and expense tracking apps to improve their financial decision-making.
The study reinforces the findings of Trần Thị Mai Ly (2023) and Lê Long Hậu (2019), emphasizing the significant impact of family financial education on students' financial skills Notably, it challenges conventional views that prioritize parental guidance, revealing that students who utilize digital financial resources can cultivate effective financial management skills independently.
57 parental influence This indicates a shift in how financial knowledge is acquired, with digital platforms serving as an alternative or supplementary educational source
The study reveals that financial behavior significantly influences personal financial management skills, more so than financial literacy alone, supporting previous research by Huong (2024b) and Anh (2019) Students who practiced responsible financial behaviors—like budgeting, tracking expenses, and disciplined spending—experienced greater financial stability compared to those with only theoretical knowledge This underscores the importance of incorporating behavioral finance education into financial literacy programs to help students apply their knowledge effectively in real-life situations.
This study expands on Bùi Thị Ngọc Anh’s (2020) research by highlighting the significance of social and learning environments in developing financial management skills Unlike earlier studies that emphasized financial education via coursework and familial influence, this research identifies social and peer networks, as well as digital financial communities, as vital emerging influences Students engaged in financial discussions, whether in traditional social settings or online platforms, are more inclined to cultivate responsible financial habits.
Based on the regression results in Table 4.24, the regression function on factors affecting students' personal financial management skills is as follows:
PFMS= 0.198FSB + 0.167DFL + 0.363FB +0.227FMA
Digital Financial Literacy (DFL) significantly influences personal financial management skills (PFMS), as evidenced by a Beta coefficient of 0.167 (p < 0.01) This finding aligns with the research conducted by Lusardi and Mitchell, highlighting the importance of digital financial knowledge in enhancing financial management abilities.
(2014), that understanding digital financial tools such as online banking, electronic payments, and financial management applications helps students make smarter financial decisions in the digital world Therefore, H1 is confirmed
The study reveals that family and social background significantly influence the development of personal financial management skills (PFMS), with a beta coefficient of 0.198 (p < 0.001) This finding aligns with previous research by Joo and Grabe (2004), highlighting the role of parents as crucial role models who guide their children in financial management from an early age Additionally, fostering a positive social environment and maintaining healthy relationships further contribute to the enhancement of these skills.
58 friends also facilitate students to develop positive financial attitudes and behaviors Therefore, H2 is confirmed
A positive financial management attitude (FMA) significantly enhances personal financial management systems (PFMS), as indicated by a Beta coefficient of 0.227 (p < 0.001) This finding aligns with Hira and Mugenda's (1999) research, which highlights that individuals with a proactive approach to financial planning, saving, and establishing long-term goals are more likely to attain greater financial stability, thus confirming hypothesis H3.
Financial behavior (FB) is a crucial determinant of financial management skills, evidenced by a strong Beta coefficient of 0.363 (p < 0.001) This indicates that positive financial habits, including regular savings and responsible spending, significantly influence one's financial management abilities This finding aligns with the research of Atkinson and Messy (2012), which highlights that financial behavior is a practical manifestation of financial knowledge and attitudes in everyday life Consequently, H4 is confirmed.
The confirmation of hypotheses H1, H2, H3, and H4 with high statistical significance reinforces the theoretical framework and highlights the critical role these factors play in enhancing students' personal financial management skills.