An analysis of the expenditure patterns and budgeting practices among university students: a case study of the School of Statistics and Planning, Makerere University

Abstract

This study analyses the expenditure patterns and budgeting practices among university students, focusing on a case study of the School of Statistics and Planning at Makerere University. The study aimed to assess how demographic characteristics influence spending habits and to identify the motivations and barriers impacting financial management. By utilizing a quantitative cross-sectional design, data was collected from 203 third year undergraduate students using a stratified random sampling technique that transitioned into convenience sampling. Findings from a two-way ANOVA revealed that living arrangement significantly affects essential expenditure (p < 0.001), while gender does not. However, neither gender nor living arrangement showed a statistically significant effect on non-essential spending (p = 0.613, 0.174). A chi-square test of independence demonstrated that student’s primary income source - which was predominantly parental support (70%) - has no significant relationship with their choice of a budgeting tool (p = 0.066). The data highlights a heavy reliance on informal financial tracking, with 51.24% of the students using either mental budgets or no budget at all. While students are motivated to budget to control daily spending (44.8%), they are mainly hindered by the perceived complexity of tracking expenses (28.1%), and income unpredictability (26.6%). It was also noted that students’ budgets frequently deviate due to unforeseen expenses (47.3%). The study concludes that financial management behaviors are largely driven by psychological factors and structural living conditions rather than income sources, which underscores the need for context specific financial literacy interventions.