The Influence of Time Orientation on Personal Finance Behaviours
Promoting responsible personal finance behaviours is an under-researched area in social marketing. Past literature has found that those who have a future-oriented mindset tend to make more positive financial decisions. The current study fills a conceptual
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THE INFLUENCE OF TIME ORIENTATION ON PERSONAL FINANCE BEHAVIOURS Daniel Rutledge, University of Lethbridge, Canada Sameer Deshpande, University of Lethbridge, Canada ABSTRACT
Promoting responsible personal finance behaviours is an under-researched area in social marketing. Past literature has found that those who have a future-oriented mindset tend to make more positive financial decisions. The current study fills a conceptual gap in research by attempting to positively influence the future orientation levels of participants by exposing them to a brief priming stimulus. Although this attempt was not successful other results are encouraging. Low future orientation was associated with increased levels of debt; low present orientation was related to increased amounts of personal savings; and younger people tended to be more present-oriented. Also, predictors of savings satisfaction were found to include job security, financial knowledge, access to credit, family income, and total non-mortgage debt. Social marketers can use these personality and demographic indicators to segment populations into homogeneous segments and tailor marketing campaigns to motivate responsible borrowing and saving decisions. INTRODUCTION Personal finance issues have become important topics of discussion as a result of the recent world economic crisis. Many American families lost their homes due to unmanageable mortgage payments and decreasing home prices. This economic downturn was responsible for millions of job losses in the United States resulting in the unemployment rate jumping from 5.8% in 2008 to 8.9% in 2011 (Bureau of Labor Statistics, 2012). During the financial crisis period, personal investments and pension fund values around the world dropped rapidly, which led to questions about how financially prepared societies are for the future. Increasingly, individuals in the U.S. and other OECD countries are saving less and borrowing more (Girouard, Kennedy, & André, 2007; OECD, 2009). This study investigates whether a personality trait, time orientation, can be primed in individuals in order to encourage responsible financial decision making. Past literature regarding time orientation has shown that those who are more likely to think about the future consequences of their action tend to have more personal savings (Rabinovich & Webley, 2007) and have a greater likelihood to participate in savings programs (Howlett, Kees, & Kemp, 2008), while those who are less likely to think about the future consequences of their actions are more likely to borrow money (Webley & Nyhus, 2001) and have debt (Lea, Webley, & Walker, 1995). It has also been suggested that attitudes about the future may change over time (Strathman, Gleicher, Boninger, & Edwards, 1994; Toepoel, 2010). This is the first study that tests whether it is possible to influence future orientation during a brief experimental manipulation. Also, this study tests whether people’s intention to save and borrow, can be influenced as a result of future orientation being manipulated. If su
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