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Promoting Inclusive Markets and Financial Systems

Chapter 2

This is Chpater 2 Decision Making

 

Financial Decision-Making Behaviors of Youth
This section looks at the financial decision-making behaviors of youth (e.g., spending, saving, and borrowing) and how their families are
integrated into this decision-making process. Youth may experience financial pressures from the following life-cycle events:
• Education
• Marriage
• Childbirth
• Taking care of family
To overcome these challenges, young people may need to make a variety of financial decisions, which may include the following:
• Postponing unnecessary expenses and studies
• Increasing the amount of part-time work or finding seasonal work
• Selling additional crops (in an agrarian-based society)
• Migrating
• Saving at home or with another person
• Saving in kind (animals); selling animal or things
• Borrowing from friends, family, or a local shopkeeper
• Borrowing from an informal association
• Drawing on community assistance or mutual help (AIM Youth - Mali , AIM Youth - Senegal)
Spending: Market Research Findings
In most of the developing world, youth spend their money on food,
clothing, school supplies, and by contributing to the household and
savings (YouthStart). Some of these expenses are basic needs (e.g., food
and school supplies for in-school youth; basic clothing and personal
care items, especially for girls; transportation; and household expenses),
while others are more discretionary (e.g., entertainment, Internet and
mobile phone use, brand-name clothing, accessories) (YouthSave).
Clothing and shoes are a common expense across all regions due to the
social pressure to look good, but also due to the rough environment and
physical conditions of many countries, where clothes and shoes wear
out quickly and need to be replaced (AIM Youth–Mali).
Young people also spend money on inputs for their businesses or
income-generating activities (IGAs), including commerce, agriculture,
and animal husbandry (especially in rural areas). Expenses may vary
according to the changing life cycle of youth (e.g. education, marriage,
business, childbirth, asset building, health and education of children).
In some countries in Asia (e.g., India) and Africa (e.g., Burundi, Mali, and Senegal), it is important for a girl’s family to provide a dowry or
trousseau to help her get started in her new life; the family may thus encourage a girl to contribute to this important occasion as well.

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