Financial decision-making by the population: Process modeling and trends

Abstract

Background: The present study focuses on the nature of the population's financial decisions carried out under the personal financial planning process by people. Method: The methodological basis of the study is constituted by such methods of scientific research as statistical monitoring and comparative analysis, synthesis and forecasting. The authors have presented a model of consumer choice. Findings: The authors have analyzed the financial public decisions made in the context of economic instability; personal finance structure and consumer sentiment level dynamics have been covered; Russian citizens' income differentiation trends have been shown. The main results of the study provide insights into the tendencies in the economic behavior of citizens that can be characteristic of the population of any state at times of macroeconomic parameters volatility. In particular, the authors identified comparative structure of the attracted credit resources and the citizens' savings accumulated in commercial banks; it shows the ratio of savings and the amount of mandatory expenditures of the population; the Russians' consumer sentiment index dynamics has been traced; the population has been arranged by quintile groups on the basis of the existent income differentiation trends in the Russian society. Key findings of the study are identification of very weak signs of the population's adaptation to the economic and the geopolitical situation volatility, which is reflected in the discernible consumption bursts. Improvements: The authors have proved that the motivation for the population's financial decisions and the socio-economic stratification in Russia are crucially influenced by such factors as the loss of a source of income (job) and the devaluation shocks.