Influence of Homemakers’ Spending Practices and Consumer Credit Use on Family Welfare at Sakumono Estates, Tema

Abstract

This study was conducted to assess how the spending practices and consumer credit use among homemakers at Sakumono Estates in the Tema Municipality influenced family welfare. The specific objectives were to: examine the income and expenditure patterns of homemakers, investigate the management principles applied by homemakers in the use of money, investigate the perception and consumer credit use by homemakers and identify factors that influenced homemakers’ spending practices and credit use. Five null hypotheses were stated. Ho1: There is no relationship between homemakers’ demographic characteristics (age, educational level, marital status, occupation, income status) and spending practices. Ho2: There is no relationship between homemakers’ demographic characteristics (age, educational level, marital status, occupation, income status) and consumer credit use. Ho3: There is no relationship between homemakers’ spending practices and consumer credit use. Ho4: There is no relationship between homemakers’ spending practices and family welfare. Ho5: There is no relationship between homemakers’ consumer credit usage and family welfare. A proportionate sample of two hundred and fifty-two (252) homemakers was interviewed using a structured interview schedule. The data were analysed using the Statistical Package for Social Sciences (SPSS) version 21 to generate frequency and percentage distributions. Likert scale scores were used to aggregate spending practices, consumer credit use, perception of consumer credit, family welfare and financial stress. Pearson’s Correlation Coefficient test and simple linear regression analysis were used to test the null hypotheses at 5% level of significance (p = 0.05). The findings revealed that the mean age of the homemakers was 45.5 years with an average household size of five. The majority (70%) had attained post-secondary and tertiary levels. Homemakers earned a mean monthly income of GH¢1,100 from salaries and wages (93.7%). The mean monthly housekeeping money was GH¢600 contributed by both homemakers (98%) and husbands (70%). The top six expenditure categories with high means included education (GH¢539.26), food and non-alcoholic beverages (GH¢252.98), accommodation (GH¢152.11), transportation (GH¢130.60) children’s clothing and footwear (GH¢96.67) and utilities (GH¢82.45). The homemakers were the financial decision-makers (77%). Financial management principles applied included planning or budgeting 226 (89.7%) organizing expenditure (73%), implementing financial plans (75%) and partial evaluation of financial plans (57%). Perception of consumer credit was low (54.4%) but 72% used it for varied reasons. Spending practices were influenced mainly by personal (99.2%), economic (91.2%), social (71.4%) and business factors (63.4%). More than half (55.8%) of the homemakers assessed their spending vis-à-vis family goal attainment as very good and more than two thirds (68.7%) said they had enhanced family welfare. Simple linear regression analysis revealed that age (p=0.01), educational level (p=0.01), occupation (p=0.01) and income status (p=0.01) predicted spending practices whereas educational level (p=0.05) and occupation (p=0.01) predicted consumer credit use. Spending practices (p=0.001), on the other hand, predicted family welfare implying that homemakers who applied good spending practices had enhanced family welfare. It is concluded that to some extent, homemakers spending practices and consumer credit use did influence their family welfare both positively and negatively. It is recommended that stakeholders in the field being examined including the Ministry of Education, Extension workers, Ghana Home Economics Association (GHEA), Microfinance and Consumer Credit institutions, should design practical educational programs for both formal and informal deliveries to provide knowledge and skills required for financial management matters, particularly good spending practices and consumer credit use, to enable both present and future homemakers make informed and effective decisions regarding the use and management of money and credit to enhance family welfare. Also, the stress experienced by homemakers as they perform the important responsibility as financial managers of the household is likely to reduce. Acquisition of such skills by as many homemakers as possible would reduce the stress experienced by homemakers as they perform these important responsibilities which are central to family welfare