DOES THE COVID-19 PANDEMIC AFFECT PERSONAL FINANCIAL DECISIONS IN THE NEW NORMAL ERA? A VULNERABILITY PERSPECTIVE IN INDONESIA

• Main Author: Najmi, Nurun
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/80189
• Institution: Institut Teknologi Bandung

The study aims to empirically test a comprehensive model of changes in personal financial decisions, which includes changes in consumption, savings, investment, and spending on charity. This study examines the collective impact of various factors, including personality traits, pandemic-related perceptions and attitudes, social media usage, religiosity, and financial attributes on vulnerability and changes in financial decisions as the world transitions from the COVID-19 pandemic to the new normal period. Responses from 377 participants who are Indonesian citizens living in Indonesia and aged 17 years or over are collected through distributing online survey questionnaires. Relationships between variables are analyzed using a structural equation modeling (SEM) approach. Additionally, this study extends its analytical approach by using statistical difference tests—specifically, Mann-Whitney, Kruskal- Wallis, and Wilcoxon tests—to provide additional insights. The results of this research show a fundamental shift in financial decision from the Covid-19 to the new normal period. This research confirms that vulnerability is a shared experience that transcends demographic boundaries, thereby impacting all individuals across demographic groups. This experience of vulnerability is influenced by personality traits, perceptions and attitudes related to the pandemic, social media usage, financial planning and financial situation. Analysis of the relationship between construct variables also reveals a significant influence between vulnerability due to the pandemic and changes in consumption, savings, and investment. On the contrary, different results are found, which revealed no significant influence of the vulnerability experienced by individuals on changes in spending on charities. In addition, the indirect effects of personality traits, pandemic-related perceptions and attitudes, social media usage, and financial attributes on changes in personal financial decisions emphasize the critical role of the individual's experience of vulnerability. The results of this research provide theoretical and practical implications that can be useful for the government, policymakers, financial industry players, and society.