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Stream/Area:
-
Subject:
-
Paper ID:
IJSREM67754
Volume:
10 |
10 |
Oct 2026
Pages:
1-16
Publication Frequency:
Monthly (12 issues per year)
License:International Journal of Scientific Research in Engineering and Management follows the Creative Commons Attribution 4.0 (CC BY 4.0) License, allowing free use and distribution with proper attribution.
Department of Bachelor of Business Administration
K.L University
Department of Bachelor of Business Administration
K.L University
The trade-offs facing households between current consumption and future saving are influenced by price changes. This research aims to uncover how inflation affects millennial household saving and spending behaviour as well as to investigate whether financial uncertainty plays a mediating role and whether financial literacy plays a moderating role. Five-point Likert items were used to collect primary data from the young adults by a structured questionnaire and the instrument used for this purpose was reliable. The data were analysed using chi-square tests, one way ANOVA, simple and multiple linear regression, Baron–Kenny/Sobel mediation test and moderation test with an interaction term. Financial uncertainty, financial spending behaviour, and saving behaviour were significantly and strongly affected by the perceived inflation. Financial uncertainty partly explained the links between inflation and both saving and spending, and was also a significant determinant of spending. There was no significant moderation found for any paths by financial literacy. Income level, age group and employment status were important factors in explaining the variation in saving, spending and uncertainty, as the highest income group reported lowest inflation effects while gender and EMI/loan status reported no significant effects. The results indicate that inflationary pressure on younger households acts mainly via uncertainty regarding their future earnings. Policies and financial instruments should therefore respond to inflation pressure, as well as financial confidence.
KEYWORDS
This study used a primary data with 93 respondents to find out the impact of inflation on the saving and spending behaviour of millennials. Saving behaviour was strongly and significantly affected by inflation, as was spending behaviour and financial uncertainty, which in turn partially mediated these behavioural effects and significantly influenced spending behaviour. There was no significant moderation of the relationships by financial literacy. Households' income, age and employment status were found to be significant factors in how affected a household was, with the highest income group least affected, while EMI/loan status and gender had no significant effect. Overall, the findings suggest that inflation affects millennial households in two ways: directly through the budget squeeze, and indirectly by raising financial uncertainty.
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Publication Date
10/9/2026
Peer Review Type
Double-Blind Peer Review
Review Rounds: 2
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