eThesis - School of Business electronic theses

The objective of the study is to examine Finnish university students' attitudes towards debt and student loan taking. The study also tries to find out the ways to improve Finland's student loan system. In addition to investigating the determinants of student loan taking and ways to improve Finland's student loan system, the thesis gives an overview of Finnish university students' student loan behaviour. In the thesis, students' attitudes towards debt are measured using the concepts of Fear of Debt and Debt Utility.

The data of the study is gathered with tailored questionnaire. The questionnaire includes questions about demographics, characteristics, debt attitudes, student loan behaviour and working during the studies. It also includes statements that present six possible improvements to student loan system. The sample consists of 3 448 respondents of which 1 516 have taken a student loan. The survey was targeted to students at the universities of Helsinki, Oulu and Tampere.

The results of the study show that generally Finnish university students are concerned about their future employment prospects but they also tend to underestimate their probability to get a job after graduation. Students appreciate more the improvements to student loan system that will guarantee their livelihood in the case of unemployment after graduation than the improvements that will reward them if they are able to graduate within targeted time.

The investigation of the determinants of student loan taking show that student loan takers have positive attitudes towards debt but at the same time they fear the loan taking. Furthermore, student loan takers are surer about their future employment prospects, more willing to take financial risks, poorer money managers and have more internal Locus of Control than the students who have not taken a student loan. Moreover, student loan takers have been at the university longer and are more often worried about their financial situation than the students without a student loan. Concerning the students' debt attitudes, the results indicate that students who have been longer at the university have greater tolerance of debt and that male students tend to have more positive attitudes towards debt than female students.