IMPACT OF FAMILY AND FINANCIAL

POSITION ON THE HOUSEHOLD

INVESTMENT DECISIONS
Presented By
Sukesh R
15MBAP054
MBA I Year
Sub: Research Methods For
Management

Article Details
Authors: R suryaprabha and K Malarmathi
Journal: Prerana Journal of Management Thought and Practice
Vol No: 7
Year : March 2015
Page Number: 1-13

INTRODUCTION
Investment is the commitment of funds which have been saved from
current consumption with the hope that some benefits will be
received in future
Investing is a serious subject that can have a major impact on
investors future well-being
The risk and returns available in each of investment avenues, and it
is differ from one avenue to another

CONT.
Indians having the impact of traditional values, family relationships
on every aspect
This psychological feelings plays an important part in investments
Thus investment become vital part in the family and relationships
within families are given much treasure
Investment decision maker in a family may be family head, spouse,
parents, and children or sometimes it may be a joint decisions

OBJECTIVE
Study the relation between investment decisions and individual &
family income level
Study the investment decisions on their income-expenditure pattern
& the influence of preference investment avenues
Analyse the family awareness of individual investment details
Analyse the individual investment decisions and the investors
retirement needs

HYPOTHESES
H1: There is no significant relationship between investment decision
maker in the family and individual annual income
H2: There is no significant relationship between investment decision
maker in the family and family annual income
H3: There is no significant relationship between investment decision
maker in the family and income expenditure ratio

CONT.
H4: There is no significant relationship between investment decision maker and the
influence behind the preference of investment avenues
H5: There is no significant relationship between family members awareness on the
investment and investment decision maker
H6: There is no significant relationship between financial needs during retirement
and investment decision maker
H7: There is no significant relationship between Family type & Financial
dependency and investment decision maker

METHODOLOGY
This study is descriptive in nature
The datas were collected using survey methods
Non probability - convenience sampling design is used
The Questionnaires used in this survey is divided into seven parts
This questionnaires was distributed to those who worked in service
sectors like IT/ITES, Education institution, Bank, NBFC and
Insurance Company in Coimbatore area.

CONT..
A pilot study was carried with 50 respondents
Reliability was measured through cronbachs alpha, and the value
found to be 0.6821
Altered questionnaire distributed to 475 samples and 85.26% (405)
were responded with properly filled questionnaires
Nonparametric test such as chi-square test and Kruskal- Wallis tests
were used to analyse the datas

RESPONSE BETWEEN HOUSEHOLD INVESTMENT

DECISION MAKER AND INDIVIDUAL ANNUAL INCOME
Individual Annual
Income(Rs)
<1 lakh
1-2 lakh
2-3 lakh
3-4 lakh
4-5 lakh
5-6 lakh
>6 lakh
Total

No
%
No
%
No
%
No
%
No
%
No
%
No
%
No
%

Household investment decision Maker

Self

Parents

Spouse

Siblings

Children

In-laws

Total

11
26%
45
37%
40
43%
26
50%
20
51%
12
57%
24
63%
178
44%

22
52%
42
35%
26
28%
13
25%
9
23%
4
19%
2
5%
118
29%

4
10%
29
24%
20
22%
10
19%
8
21%
3
14%
9
24%
83
20%

4
10%
1
1%
2
2%
2
4%
2
5%
1
5%
2
5%
14
3%

1
2%
3
2%
3
3%
0
0%
0
0%
1
5%
1
3%
9
2%

0
0%
1
1%
1
1%
1
2%
0
0%
0
0%
0
0%
3
1%

42
100%
121
100%
92
100%
52
100%
39
100%
21
100%
38
100%
405
100%

H1 : Chi-square Test Results Between Household

Investment Decision Maker And Individual Annual Income
Household
investment
decision maker

Variables

Financial
Situation

Individual Annual p value

Income
Chi square value

0.042
44.607

Association
between
variables
Significant

H2: Chi-square Test Results Between Household Investment

Decision Maker And Family Annual Income
Household
investment
decision maker

Variables
Financial
Situation

Family Annual
Income

p value

0.027

Chi square value

40.292

Association
between
variables
Significant

H3: Chi-square test results between Household investment decision

maker and income expense ratio
Variables

Financial
Situation

Income Expense
Ratio
SEC

p value
Chi square value
p value
Chi square value

Household
investment
decision maker
0.018
21.448
0.335
22.105

Association
between
variables
Significant
Not Significant

H4: Chi-square Test Results Between Investment Decision Maker And

The Influence Behind The Preference Of Investment Avenues
Variables

Investment
Decisions

Most preferred
investment avenue
Reason for preference
of investment avenue

Household
investment
decision
maker
p value
0.6
Chi square value 27.439
p value
0.048
Chi square value 31.591

Association
between
variables
Not Significant
Significant

H5: Chi-square test results between investment decision maker and

family members awareness on the investment
Variables
Investment
Decisions

Spouse/ Children Aware of p value

the details of my
Chi square value
investments

Household
investment
decision maker
0.009
15.239

Association
between
variables
Significant

H6: Chi-square Test Results Between Investment Decision Maker And

Financial Needs During Their Retirement
Household
investment
decision maker

Variables

Investment
Decisions

Clear idea about my

financial needs during
retirement

p value

0.000

Chi square value

22.75

Association
between
variables
Significant

H5: Chi-square test results between investment decision maker and

family members awareness on the investment
Household
investment
decision maker

Variables
Investment
Decisions

Spouse/ Children Aware of p value

the details of my
Chi square value
investments

0.009
15.239

Association
between
variables
Significant

H6: Chi-square Test Results Between Investment Decision Maker And

Financial Needs During Their Retirement
Household
investment
decision maker

Variables

Investment
Decisions

Clear idea about my

financial needs during
retirement

p value

0.000

Chi square value

22.75

Association
between
variables
Significant

H7: Chi-square test results between investment decision maker and

Family type & financial dependency

Variables
Family and
House
holds

Family type
Financial

Sig value
Chi square value
Sig value
Chi square value

Household
Association
investment
between
decision maker
variables
0.147
Not significant
14.608
0.129
Not significant
21.257

FINDINGS
The individual annual income, the family annual income, income
expense ratio, reason for preference of investment avenue, family
awareness on investment decisions, individual investment skill,
financial need during retirement are have significant relation with the
household investment decision maker
The investors family type, individual financial dependency, socio
economic classification, most preferred Investment Avenue are doesnt
have significant relation with the household investment decision maker

CONCLUSION
This study provides the relation between different kind of financial situation and
the investment decision maker in the family
When the individual financial situation is not in a stable position then the
parents takes the role of investment decision maker and individual decisions are
taken when the solid financial position
In future the study need to conduct with more sample for better understanding
and need to analyse the factors like type of investments, joint investment
decisions, etc.,