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CHAPTER I
BACKGROUND OF THE STUDY


Introduction
"To earn what you can; spend what you must;
Give what you should, and save the rest -this is thrift"
-J.O Englemen, 1918

Instilling to the students the mindset of putting away money does not only teaches
them the value and importance of being frugal, but actually gets the ball rolling on their
path to financial literacy in the future.
Saving money, for Filipinos, started even in the old times. It is a heritage passed
on by our ancestors further develops by the blend of Hispanic and other Asian cultures
that inhabited the country. The Filipinos are naturally "matipid" so to speak. There is an
inherent Filipino characteristic of thriftiness or frugality that even in the midst of scarcity,
a small amount of savings is a significant investment for the future.
The Filipinos way of saving then was done by the use of old and empty cans
where Pinoys dropped in their coins regularly until it was full. Other used the "kawayan"
and other creative representation of a coin bank. Nowadays, modern coin banks come in
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all forms and sizes. But the tradition and authentic Filipino saving model represented by
the "piggy bank" can never be outshined.
But as time goes by, Filipinos nowadays have a different idea of saving so its not
quite surprising why very few are saving money in the banks. Most prefer to live by
the bahala na lifestyle where let tomorrow worry for itself. We often tend to spend our
monies as soon as we earn them or worse, even before we earn them.
Filipino people grew up in the environment where saving is not trending. Parents
may teach us to look for the best deals to be able to save a few cents but not the actual
financial literacy which could help in the long run. Filipinos trained to be contented with
what is available and which is why Filipinos find it difficult to plan or get ready for the
future. Emergency funds dont exist to most Filipino families lives.
To be frugal is to be wise. It's easy to overspend, to pamper ourselves with
luxurious goods and trendy clothes, but it is smarter to make a budget and stick to it. If
we educate ourselves about money: how to handle it, manage it, and essentially make it
grow and develop more frugal spending habits and save money for the future, we are
doing ourselves a big favor.
An infographic released by Money Summit & Wealth Expo revealed some of the
shocking facts about the saving and investing habits of Filipinos. That only 2 out of 8
Filipino household have a bank deposit and 43.8% of Filipino spent more than their
income, the information only shows that there is something wrong on how we handle our
finances. Filipinos need to become more financially literate in order to make more sound
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financial decisions. Start by learning about the various financial instruments, talk with a
financial advisor or coach, read personal finance blogs, attend a seminar or buy a book.
In regard with this, the proponents of this study decided to put up Students "save
and earn" Funds because in this time, most students is definitely aware and concerned
with the continuous and uncontrollable increase in price of goods and services, especially
their needs. In order to cope with it, students from their own strategies manage their
allowance, so this proposed business will help the student of Batangas State University -
ARASOF Nasugbu to educate them about saving their extra money to us and earn interest
at the same time and this can boost the knowledge of the students that their money can
grow once they know how to handle it. And this will also inculcate the value of saving at
young age and imbibing the importance of saving money that will surely help them and
become the country's future nation builder.









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Brief Background of the study
At the present time, it is now easy to open an account at a young age. Different
banks now in the Philippines offer a saving account for children as well as for the
teenagers. Banks encourage the parents to get their child involved in saving their money
since it is one of the important lessons that the parents should impart to their children.
In Philippines, Bank De Oro (BDO), Philippine Saving Bank (PSBank), Bank of
the Philippine Island (BPI) and Metro Bank are the most popular banks that offer a
saving account for children. Opening a kiddie savings account in this institution is very
easy, in fact by law, any child who can read and write at the age of at least seven years
old can legally open a savings account, time deposit, withdraw, deposit using their own
names and signatures (presidential decree no. 734 issued 1975).
Even though this kind of program is introduced a long time ago still there are so
many peopling who are not aware of this, especially those who visit banks occasionally.
Because of this, the proponents of this study seen a need for this kind of business to be
establish in Batangas State University ARASOF which is the Student save and earn
Fund.
The Students "save and earn" fund is designed to help and guide the student to
manage their extra money. This is a little bit similar to what other bank is being offered
but it is more convenient since the proposed business is a school based. And what makes
it different is that there is no need for initial deposit. They can easily withdraw the save
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money as long as they fulfill the needed requirements and the rules of the proposed
business.
This type of business is not an easy task to do since there are a lot of factors to be
considered as well as the step, policies and procedures to be followed. But this will help
each proponent to enlighten their thinking with regards to the reality of life especially as
we walk toward the path of the business world.
Furthermore, this will serve as a reference for future studies for those students
who wish to conduct a paper which is similar to such topic.

Objectives
To determine the feasibility and profitability of the Student save and earn Fund
at Batangas State University- ARASOF, Nasugbu.

Specific Objectives
1. To determine the marketability of the proposed business.
2. To classify the technical requirements of the proposed business.
3. To promote the most suitable method for the management in operating the
business.
4. To determine in the financial aspect of ways of maximizing the profit while
minimizing the cost.
5. To prove that the proposed business will provide benefits to the proponents,
government, university, students as well as the people around us.
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Definition of Terms
Allowance. The totality of students money; is an amount of money given or allotted
usually at regular intervals for personal spending.
Collateral. Assets that are offered to secure a loan or other credit.
Commercial Bank. Is a type of bank that provides services such as accepting deposits,
making business loans, and offering basic investment products.
Frugality. Is the quality of being frugal, sparing, thrifty, prudent or economical in the use
of consumable resources such as food, time or money, and avoiding waste, lavishness or
extravagance.
Interest. A charged for borrowed money that is made on invested capital.
Invest. To commit or deposit money in order to earn financial return.
Lending. An activity to give or allow the use of temporarily on the condition that the
same or its equivalent will be return with interest.
Loan. Is a debt provided by one entity to another entity at an interest rate, and evidenced
by a note which specifies, among other things, the principal amount, interest rate, and
date of repayment.
Luxury. A condition of abundance or great ease and comfort.
Subscriber. A person who will deposit money, the depositor.

Save and Earn. It is the program that will be offer by the proposed business where the
subscriber have a chance to save and will earn a reasonable interest.
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Scope and Limitation
This study aims to establish a Students "save and earn" Funds. This study will be based in
management, marketing, technicality, socio-economic, and financial aspect of business. The
study will include the college students of Batangas State University -ARASOF Nasugbu who
will be the potential and future subscriber of the business. This will cover all important aspects
that are to be taken into consideration in implementing the proposed business.
The proposed business will only involve the two systems which are the savings for
student of Batangas State University- ARASOF which they have the opportunity to earn interest
and the lending system for the vendor of the school canteen, cafeteria and sari-sari store vendor.
The study is to be conducted for two (2) semesters. Any data that will be obtained,
developed and analyzed will be based on the results of surveys, interviews and other assumptions
to be made. The study is focused only to the college student of Batangas State University -
ARASOF.