The Relationship Between Monetary Attitudes and Investment Behaviour Among Teachers in Swaziland

Abstract

Despite its above average GNI per capita among sub-Saharan Africa nations, the rate of savings in Swaziland is below the average for the region. Savings theories allude to a favourable association between income and savings. The obtaining situation in Swaziland contradicts these theories. There has been no scientific enquiry undertaken to understand the possible cause(s) for this deviation. Studies conducted elsewhere on the same phenomenon, suggest that money attitude is a contributor to its occurrence. This study was conducted to determine if money attitudes are related to the investment behaviours of teachers in Swaziland. Teachers were selected because their standardised salaries ensure that income can be predominantly held constant. Investment other than savings behaviour was selected because it offers more insight on individual saving habits. The study population consisted of the 16 918 primary and high school teachers in Swaziland. The stratified and cluster sampling methods was utilised to guarantee that all geographical regions in Swaziland were represented, and to ensure efficiency, respectively. Questionnaires were administered to a sample of 304 educators. Descriptive and inferential measurements were generated from the data. A key finding from the descriptive statistics is that 40% of teachers were unable to save money on a recurrent basis. F and t-tests were applied to ascertain the significance of identified associations between the variables of interest. Correlation results indicated the following: The ability to save money is associated with the value importance of money and skills at handling money factors; engagement in business ventures is associated with knowledge of financial affairs, comfort in taking financial risks, skills at handling money, and the use of money as a source of status and power factors; investment in long term interest bearing instruments is associated with the value importance of money, personal involvement with money, knowledge of financial affairs, and comfort in taking financial risks factors; and the frequency of drawdowns from investments is negatively correlated with the money as a source of status and power, comfort in taking financial risks and the value importance of money factors. Regression results indicated that: skills at handling money is a significant predictor of the likelihood for teachers to save; knowledge of financial affairs is a significant predictor of the likelihood for a teacher to engage in a business venture or invest in long term interest bearing instruments; whilst using money as a source of status and power increases the likelihood for a teacher to make frequent drawdowns from investments. All relationships were significant at the 0.01 level and the predictor variables explained less than 5% of the variation in each case. A key recommendation from the study is that financial education must be offered at high school level to all students, in order to improve their money handling skills and knowledge of financial affairs.