THE INFLUENCE OF FINANCIAL PLANNING ON THE RELATIONSHIP BETWEEN HOUSEHOLD INCOME AND LEVEL OF SAVING IN TANZANIA

There are many studies on the relationship between household income and saving though very little is known about the influence of financial planning on the relationship between household income and saving.This paper examined the moderating effect of financial planning on the relationship between household income and saving in Tanzania.Based on cross-sectional secondary data (Finscope data,2017) that was collected using multistage sampling from 9457 respondents, descriptive, correlation, regression and moderation effect were performed to analyze the data.The findings indicate that household income and interaction effects have a positive relationship with level of saving. Finally, regression results show that household income and financial planning have a positive significant effect on household saving levels and that financial planning has a positive moderating effect on the relationship between household income and level of saving. From these study results,it is recommended that the government of Tanzania through the ministry of community development, gender and children in should introduce financial awareness programs to the communities in order for the people to realize the need of financial planning and hence improve their saving.Further more the government throughthe ministry of education and vocational training should introduce financial awareness in the school curriculum so that citizens learn how to plan for financial matters at early stages.