Relationship Between Financial Literacy, Materialism, and Impulsive Buying on Financial Behavior and How it Influences the Financial Decision on Undergraduate Students of Bandung Institute of Technology

Abstract

Proper financial literacy and financial behavior are essential for financial decision-making. An individual's materialistic attitude also leads to a person's tendency to purchase impulsively, thus negatively impacting on undergrads' financial behavior. Graduating students face a crucial period in their lives where they are becoming financially independent. Students must have good financial literacy and financial behavior when making financial decisions. This research is aimed to seek the relationship between financial literacy, materialism, and impulsive buying on financial behavior and how it influences the financial decision of undergraduate students at Bandung Institute of Technology. Using the quantitative methodology, the researcher surveyed 391 respondents. For studying each variable, the researcher is also using the purposive sampling technique and PLS-SEM. This study found that financial literacy significantly influences financial behavior and the same with financial behavior on a financial decision. Financial literacy does not have a significant relationship on financial decisions. Furthermore, materialism has a significant influence on impulsive buying, but materialism does not have a significant influence on financial behavior. Impulsive buying has a negative and significant influence on the financial behavior of ITB undergraduate students.

Keywords: Financial Behavior, Financial Decision, Financial Literacy, Impulsive Buying, Materialism.