UNVEILING THE PSYCHOLOGICAL TRIGGERS OF OVERDEBT: INSIGHTS FROM THE TEACHING PROFESSION IN INDONESIA

Abstract

This study investigates the influence of psychological biases specifically over-optimism, present bias, herd behavior, anchoring bias, and mental accounting as antecedents of overdebt behavior among schoolteachers in Indonesia. Employing a quantitative cross-sectional research design, empirical data were collected through structured questionnaires distributed to a stratified random sample of 458 public and private school teachers across various regions. Multiple regression analysis reveals that all five psychological biases significantly and positively predict overdebt behavior, explaining 42% of its total variance. Among these factors, present bias and herd behavior emerged as the most dominant drivers, indicating a strong tendency toward impulsive financial choices and peer conformity. Furthermore, moderation analysis demonstrates that income level exacerbates the effect of present bias, leaving lower income teachers particularly vulnerable. These findings offer valuable practical contributions for policymakers and educational institutions, highlighting the necessity of tailoring financial education programs to address psychological triggers rather than focusing solely on basic financial concepts. By integrating behavioral interventions into professional development frameworks, stakeholders can promote long-term financial resilience and mitigate overdebt risks among educators.