UNIVERSITI KUALA LUMPUR BUSINESS SCHOOL

JANUARY SEMESTER 2016

EIB10103: WRITING FOR ACADEMIC PURPOSE

RESEARCH REPORT (30%)

GROUP IB31

NAME:

1. NUR SYAFIQAH AZNIN BINTI AZMAN 62215216108

2. NURFARZANA BINTI MOHD TARMIZI 62215216114

3. AINA DALILAH BINTI ABD HALIM 62215216121

4. MOHD AZERUL AZIM BIN HARON 62215216200

5. AIN ASMIDAR BINTI RIZZUAN 62215216173

TITLE OF REPORT: THE EFFECTS AND CAUSES OF FINANCIAL PROBLEMS

LECTURER: DR. K. SAROJINI

DATE OF SUBMISSION: 11 MAY 2016

1.0 INTRODUCTION
2.0 LITERATURE REVIEW

2.1 Definition of key concept

 2.2 Causes of financial problem among student

“No money no talk”, people always mentioned that in their life. This is because money is
the most valuable thing that is important for us to continue our everyday life for food, shelter and
another necessary. Money also is a compulsory thing that everyone must have to further their
studies. However, a lot of students faced financial problem during their life in the university. There
are numbers of causes that can lead to this problem such as reaching for an expensive college, lack
of financial skill and using student loan inappropriately.

Firstly, the causes of financial problem among students are they are reaching for an expensive
college. According to Vohwinkle (2016), a lot of student are aiming for studying in a prestige
college and studying abroad to get a good name after they graduated even though there are not
afford it. Most students are always enrolling to the college that they can’t afford and eventually,
they only realize that problem when it is too late as they already faced the financial problem. In
short, students must consider before entering any college which they are suitable to based on the
financial matter before they have to pay for expensive fees.

Secondly, lack of financial skill also can lead to financial problem among student.
According to Jariah Masud (2004, p.1), stated that “Parents often overlook teaching financial skill
such as, budgeting and investing while their children is at home”. As their children are not used to
managing money by themselves, they will not be able to use the money correctly because they
have no knowledge skill about financial budgeting. In short, everyone must suit themselves with
managing money skill to make their financial better in the future.

Lastly, student who are using the student loan inappropriately may facing financial
problem. According to Vohwinkle (2016), many students are enjoying the benefits of the student
loan in the wrong way by spend it to the unnecessary things. At the beginning they will spend the
loan as they want it until they realize that they still have to use the money for school expenses and
the debt are increasing high. In short, the student loan given are only can be use for the college
expenses and not for the things that are not essential for college.

In a nutshell, reaching for the expensive college where they cannot afford it, lack of
financial skill and using the student loan inappropriately are the causes of the financial problem
among students. These causes of the financial problem must be avoided by all students so that the
student can focus on their study well without facing any financial problem.

2.3 Effects of financial problem among students

Money is a very valuable and important to our life as it can gives big influences to our life.
Money can support our everyday life for food, shelter, and to fulfil the human necessary needs
including studies. Student s need money to afford them to further their studies in the university
and spend their expenses while they are away from their families. But, not every students can enjoy
their studies as they are facing varies of problem including financial problem that is faced by
almost every student in the world. Students that are facing financial problem can gives several
effects on their life such as student drop out from college, health effects and impact on GPA.

Firstly, the effects that the students faced when facing financial problem is drop out from
college. According to Koppes (2015), stated that the students are hesitate whether they would
afford to pay of the college fees or not. At the end, the students are likely to withdrawing from
college. They also put away their commitment to reach their educational goals because of the high
level of financial distress. In short, financial problem can stop the students dream to reach their
goals in the future.

Secondly, financial problem also can lead to having health problem to the student.
According to Ori (2010), mentioned that if a person are having high level of stress with some
emotional support for a long period of time, it would impact their health that can cause to physical
illness as they are lack of their healthcare. Most of people who experience this are not able to
refuse the emotional feelings to influence themselves. In short, if they let the problem to preoccupy
them, it will influence their health to the worse level if they are not take some solution in it.

Lastly, impact on the student’s GPA are also the effects of financial probem. According to
Koppes (2015) “The pathway from the financial distress to lowered psychological and emotional
well-being, to lowered likelihood of college success, is complex”. Financial distress that are faced
by the students have the relationship between the depression symptoms. Which is at the same time
will affect their study because it will bothering them when they are overthinking by the financial
problem and the academic performance. In short, facing financial problem in the student life will
gives impact to the GPA if they are failed to control their depression level which at the end will
bother them in focusing in their studies to achieve good GPA.

In a nutshell, financial problem faced by the students does effects them that is lead them to
drop out from college, having health problem and lowered their GPA. It is proven that financial
problem gives negative effects to the students who are facing it. Students must aware about this
financial problem to avoid it from happening to them so they don’t have to experience such effects
stated above.

2.4 Past Research

Causes and Effects of Financial Problem

Among UniKL Business School Students

Student wellness is an important topic on college campuses nationwide as higher education

and student life administrators are becoming increasingly concerned with stress among students.
Given that stress has been shown to negatively impact student persistence, gain investigating of
graduation rates from federal and state governments should motivate administarators to understand
the causes of financial problem among students. More specifically, stress resulting from personal
financial difficulties is worth exploring in more detail given the challenge college students and
recent graduates face regarding the growing burden of student loans. The organizations
environment surrounding the college education decision has changed dramatically- grants and
other forms of aid have not kept pace with the rapid increase in tuition. As a result, students are
relying more heavily on student loans in order to pay for their education. (Draut, 2007) he
mentioned that “Working your way through college” is no longer realistic since tuition has
increased more rapidly than inflation for the last few decades.

Research regarding sources of stress confirms the important role that personal financial
problems play in the lives of college students. Financial difficulties are often cited among college
students as sources of stress (Northern, O’Brien, & Goetz, 2010; Ross, Niebling, & Heckert, 1999).
In fact, a recent report from Inceptia, a non-profit financial education counselor, found that four of
the top five stressor among college students involved problems related to personal finances
(Trombitas,2012). Although the incidence of financial problem has been well-documented, much
less is known about the factors related by identifying the factors that are associated with increased
probability of financial stress. This is the first step in understanding the causes of financial stress
among students and will provide worthful information to administrators and professional of
financial therapy, financial counseling, and financial planning.

Since administrators are concerned with the student persistence and graduation rates,
understanding the occurence of financial stress can help identify at-risk students and guide efforts
to decrease financial stress among students. Furthermore, the identification of factors associated
with increased probability of financial stress will help professional person and financial therapy
researchers understand the issues and circumstances that are espeacially important among college
students. Given the important developmental stage of traditional undergraduate students, the
experiencce of financial stress during the college years may have a long-term impact on user
wellfare. Lastly, since financial therapy is a young discipline, this study contributes by introducing
a new theoretical possibility based on the concept of adjustment that may be useful in the practice
of financial counseling and financial therapy

2.5 Research question of this study

This study has three research question:

 What are the causes of the financial problem?

 What are the effects of the financial problem?
 How the students overcome the problems of the financial problem?
3.0 METHODOLOGY

3.1 Sample

 The sample of this study consists of 50 students in the first year and also second year
student of Unikl. They were 23 males and 27 females. They come from different
programmes offered by UniKL Business School with different age started from 19-
24 years old.

Table 1 below shows the different programme of students.

Table 1

Programme of students

Programme Males Females Total

Management & Entrepreneurship 15 9 24
International Business 13 12 25
Marketing 15 13 28
Islamic Finance 7 16 23

3.2 Instrument (Questionnaire)

 We use the questionnaire to interview the students to obtain feedback on causes and
effects of the financial problem among students. There are three parts of
questionnaire that have been divided into Part A that consists of gender, course,
semester, parents occupation, parents income and ask about if the student receive
any scholarship and if they say yes , they must inform what scholarship did they
received. Part B have 6 question consists of the causes that make financial problem
among students. Next , Part C that consists of 6 question of the effect on the students
that got financial problem and how to overcome the problem. This three parts you
can see in the questionnaire that are located in appendix A
3.3 Procedure

 We conducted an interview with 50 students. Each of the member in our group take
the responsibility to interview the students individually, that is one by one. We
started this research project on the interview since 1 March 2016 to 31 March 2016.
the interview were conducted at our campus that is at the Yayasan Selangor and our
hostel in Zetapark. Each interview that we conducted each person is for 2 until 3
minutes. We also conducted the voice record during our interview that we burned
in the CD on Appendix A.

3.4 Data Analysis (Percentage)

 The data obtain from the interview was analysed using descriptive statistic, that
frequencies and percentages.
4.0 FINDINGS AND DISCUSSION

4.1 Research Question 9 : What are the causes of financial problem?

Causes Frequency Percent

No scholarship 19 38.0
Food is expensive 18 36.0
Transportation is expensive 12 24.0
Stationary 1 2.0
Total 50 100.0

Table 1 below shows the causes of financial problem among students

What are the causes of financial problem?

40% 38%
36%
35%

30%
No scholarship
24%
Percentage

25% Food is expensive

20% Transportation is expensive

Stationary
15%

10%

5% 2%

0%

Figure shows the causes of financial problem among student

The bar chart in Figure 1 shows the 38% of the students stated that the main causes of financial
problem is no scholarship . The second higher percentage , that is , 36% of the students mentioned
that the food is expensive. The third highest percentage is 24% of the student because the
transportation is expensive. Only 2% of the students said that they bought stationary is the causes
of financial problem .
 4.2 Research Question 12 : Why didn’t you apply for scholarship?

Causes Frequency Percent

Did not get scholarship yet 22 44.0
Difficult to get scholarship 15 30.0
Competition 7 14.0
Poor result 6 12.0
Total 50 100.0

Table 2 below shows why the student do not apply for scholarship

Why didn’t you apply for scholarship?

50%
44%
45%
40%
35% Did not get scholarship yet
30%
Percentage

30% Difficult to get scholarship

25% Competition
Poor result
20%
14%
15% 12%

10%
5%
0%

Figure 2 below shows why the student do not apply for scholarship

The bar chart in Figure 1 shows the 44% of the students stated that the main causes of financial
problem is did not get scholarship yet. The second higher percentage , that is , 30% of the students
mentioned that difficult to get scholarship. The third highest percentage is 14% of the student
because of the competition . Only 12% of the students said that they have poor result .
 4.3 Research Question 14 : What are the effect of financial problem on your studies?

Effect Frequency Percent

Cannot focus in class 18 36.0
Health problem 9 18.0
Depression 22 44.0
Anti social 1 2.0
Total 50 100.0

Table 3 below shows the what are the effect of financial problem on studies

What are the effect of financial problem on your studies?

50%
44%
45%
40% 36%

35% Cannot focus in class

Percentage

30% Health problem

25% Depression
18% Anti social
20%
15%
10%
5% 2%

0%

Figure 3 below shows the effect of financial problem on studies

The bar chart in Figure 1 shows the 44% of the students stated that the main effect of financial
problem is depression . The second higher percentage , that is , 36% of the students cannot focus
in class . The third highest percentage is 18% of the student having health problem . Only 2% of
the students said anti sosial is the effect of financial problem.
 4.4 Research Question 15 : Why do you cannot focus in class?

Effect Frequency Percent

Stress 24 48.0
Worried 14 28.0
Overthinking 10 20.0
Bored with lesson 2 4.0
Total 50 100.0

Table 4 below shows why the student cannot focus in class

Why do you cannot focus in class?

60%

48%
50%

Stress
40%
Percentage

Worried
28% Overthinking
30%
20% Bored with lesson
20%

10%
4%

0%

Figure 4 below shows why the student cannot focus in class

The bar chart in Figure 1 shows the 48% of the students stated that the main effect of financial
problem is stress. The second higher percentage , that is , 28% of the students are worried . The
third highest percentage is 20% of the student having overthinking . Only 4% of the students said
bored with lesson is why they cannot focus in class.
 4.5 Research Question 17 : How do you have depression?

Effect Frequency Percent

Stress 18 36.0
Worried 22 44.0
Overthinking 7 14.0
Being humble 3 6.0
Total 50 100.0

Table 5 below shows how the student have depression

How do you have depression?

50%
44%
45%
40% 36%

35% Stress
Percentage

30% Worried

25% Overthinking
Being humble
20%
14%
15%
10% 4%

5%
0%

Figure 5 below shows how the student have depression

The bar chart in Figure 1 shows the 44% of the students stated that the main effect they have
depression is worried . The second higher percentage , that is , 36% of the students mentioned that
they stress. The third highest percentage is 14% of the student effect is overthinking . Only 4% of
the students said that they being humble .
 4.6 Research Question 19 : How do you solve your financial problem?

Effect Frequency Percent

Making monthly budget 5 10.0
Saving 22 44.0
Doing part time job 10 20.0
Increase Your Spending 13 26.0
Awareness
Total 50 100.0

Figure 6 below shows how the students solve their financial problem

How do you solve your financial problem?

50%
44%
45% Making monthly budget
40%
35% Saving
Percentage

30% 26%
25% 20% Doing part time job

20%
15% Increasing spending
10%
awareness
10%
5%
0%

Figure 4 : How the students solve their financial problem

The bar chart in Figure 1 shows the 44% of the students stated they make saving to solve their
financial problem . The second higher percentage , that is , 26% of the students are increasing their
spending awareness . The third highest percentage is 20% of the student doing part time job. Only
10% of the students making monthly budget.
5.0 CONCLUSION

This study is on the effects and causes of financial problem. We selected 50 first and second year
students from our programmes in UniKL Business School as our sample. The findings show that
the most highest percentage of causes of financial problem are no scholarship. While, the most
highest percentage for the effects of financial problem are depression. The students planned that
they overcome the problem by saving to solve the financial problem. Our recommendation are that
to overcome the financial problem are,students should not waste their money from using it for not
important thing like watch a movie at the cinema. Beside that, students can making monthly
budget. This study is important to help students from waste their money and how to overcome the
financial problem.
References
S. Koppes (2015). How financial stress makes college even tougher.
Retrieved 11 May 2016 from
http://www.futurity.org/college-money-stress-999932-2/

J. Ori (2010). The effects of financial problem.

Retrieved 11 May 2016 from
http://www.ehow.com/info_8141750_effects-financial-problems.html

J. Vohwinkle(2016). Top 5 money mistakes college students make.

Retrieved 11 May 2016 from
http://financialplan.about.com/od/students/a/college-student-money-mistakes.htm

Jariah Masud (2004). Financial behavior and problem among university students: need for
financial education.
Retrieved 11 May 2016 from
https://www.researchgate.net/publication/228404924_Financial_behavior_and_problems
among_university_students_Need_for_financial_education

Trombitas, K. S.(2012). Financial Stress: An Everyday Reality for College Students. Inceptia.
Lincoln, NE. Retrieved 11 May 2016 from
https://www.inceptia.org/PDF/Inceptia_FinancialStress_whitepaper.pdf

J. Grabmier (2015). 70 percent of college students stressed about finances.

Retrieved 11 May 2016 from
https://news.osu.edu/news/2015/07/01/financial-wellness/

70 percent US College Students Worry About Money Issues Study.

Retrieved 11 May 2016 from
http://www.ibtimes.com/70-us-college-students-worry-about-money-issues-study-
1991544

http://gracepointwellness.org/217-financial-issues/news/174271-most-college-students-stressed-
about-money-study-finds
APPENDIC A : QUESTIONNAIRE
APPENDIC B : SOURCES
APPENDIC C : POWER POINT SLIDE