Saving and investment behaviour of rural families in the Ho municipality of the Volta region of Ghana

Abstract

The general objective of the study was to explore the savings and investment behaviour of rural families in the Ho Municipality of Ghana. The study was conducted using 160 rural households in four rural communities in the Ho Municipality. Interviews were used to collect data from the sampled families. Pearson’s product moment correlation coefficient, chi-square and percentages were used to analyse the data collected. It was found that the savings and investment among rural families in the municipality were low and rural households in the Municipality preferred informal forms of savings to the formal forms of savings. There was a negative correlation between age and savings as well investment. No significant relationship was found between family size and savings and investment; as well as knowledge in saving and investment as against actual savings and investment of the respondents. Inadequate income, over-reliance on natural conditions and other societal demands were found as constraints to respondents’ investment, while inadequacy and fear of safety of income were constraints to their saving. The level of knowledge of respondents on savings and investment was also found to be low. The study concluded that rural households’ low saving and investment is the result of economic, social and organisational factors. Based on these findings, it was recommended that education on savings and investment be made accessible to rural families in the form of financial counselling and introduction of basic concepts in family management into the school curriculum.