Factors Affecting Over-Indebtedness Behavior Based on the Life-Cycle Stages of Households

Abstract

This study aimed to examine factors affecting over-indebtedness behavior based on the life-cycle stages of households. This research is quantitative research. Data on household debt is collected from the survey conducted by the National Statistical Office in 2021. The logistics model is utilized to examine the relationship between the life-cycle stages of households and over-indebtedness behavior. The empirical results show that the almost all the life-cycle stages of households, including newly married, full nest I, full nest II, childless middle-aged couple, empty nest, and single parents increase the chance of over-indebtedness of households compared to young single. Moreover, higher level of education, being self-employed person, being government/state enterprise employee, ownership of housing, gambling, and car occupancy also increase the chance of over-indebtedness of households. On the other hand, higher-income individuals are less likely to become over-indebted. Therefore, Ministry of Social Development and Human Security and the government should support and promote education. by reducing the cost burden on parents. Moreover, government should take care of households with children together with appropriate measures in debt installments to allow sustainable debt repayment of households and prevent the recurrence of over-indebtedness.