Financial Literacy and Wellness among African–Americans: <i>New Insights from the Personal Finance (P-Fin) Index</i>

Yakoboski, Paul; Lusardi, Annamaria; Hasler, Andrea

doi:10.3905/jor.2020.1.070

Cited by 20 publications

(23 citation statements)

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“…This underscores meaningful differences by race and ethnicity, indicating that Black Americans and Hispanics likely face more challenges with short-and long-term financial wellbeing. This conclusion is confirmed by recent research investigating broad measures of financial well-being that include debt management across different racial and ethnic groups (Clark et al, 2021;Yakoboski et al, 2020;Yakoboski et al, 2021). Education appears to be another factor important to debt management.…”

Section: Particularly Vulnerable Subgroupssupporting

confidence: 66%

How the pandemic altered Americans' debt burden and retirement readiness

2023

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This article analyzes Americans' perceptions of being debt‐constrained. We focus on which population subgroups reported feeling most debt‐constrained, how this perception was impacted by the COVID‐19 pandemic, and how it relates to financial literacy and retirement readiness. To this end, we analyze two datasets, namely the 2020 and 2021 TIAA Institute‐GFLEC Personal Finance Index files (P‐Fin Index). The evidence shows that, prior to and during the pandemic, one in three American adults felt constrained by their debt. The percentage was even higher among vulnerable subgroups such as Black and Hispanic individuals, those lacking a bachelor's degree, those with lower incomes, and those with low levels of financial literacy. Being debt‐constrained also has long‐term financial consequences, as it is negatively linked to planning and saving for retirement. Finally, we show that financial literacy has a strong connection to both debt and retirement money management, confirming that financial knowledge is essential if people are to be able to manage their debt and build financial well‐being.

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Section: Particularly Vulnerable Subgroupssupporting

confidence: 66%

How the pandemic altered Americans' debt burden and retirement readiness

2023

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“…, 2021). Personal finance knowledge among African-American adults lags that of whites (Yakoboski et al. , 2020).…”

Section: Propositions and Synthesesmentioning

confidence: 99%

“…Immigrants have significantly lower levels of financial knowledge than their Canadian-born counterparts (Khan et al, 2021). Personal finance knowledge among African-American adults lags that of whites (Yakoboski et al, 2020). Lower self-confidence on tax literacy is related to certain demographics in Australia (Chardon et al, 2016).…”

Section: Propositions and Synthesesmentioning

confidence: 99%

“…financial behaviors: Lu ci c et al (2021),Mokhtar et al (2020) Background differences in financial knowledge:Banerjee (2016),Chen and Garand (2018),Khan et al (2021),Overton and Fox O'Mahony (2018),Yakoboski et al (2020) Background differences in financial capability:Khan et al (2017),Kim and Xiao (2021),Lazar et al (2016), O'Donnell and Keeney (2010),Okech et al (2018),Raj (2020),Robson and Peetz (2020),Sabri et al (2017),Silva et al (2010),Xiao and O'Neill (2022), Xiao et al (2015), Xiao et al (2020) P2: Background differences in consumer well-being Background and financial wellbeing: Cui et al (2019), Fan and Babiarz (2019), Nam et al (2016), Nejad and O'Connor (2016) Background and other domain wellbeing: Taylor et al (2011), West and Cull (2020) P3: Intervention to financial capability Financial socialization: Collins and Odders-White (2021), Jorgensen et al (2017b), LeBaron et al (2018), Marchant and Harrison (2020), Shim et al (2013), Wu et al (2017), Zhao and Zhang (2020) Financial education: Doran and Bagdasaryan (2018), Friedline and West (2016), Harvey (2019), Kim and Mountain (2019), Loke et al (2015), Rochelle et al (2017), Sherraden, MS et al (2011), Wagner (2019), Xiao and O'Neill (2016), Xiao and Porto (2019), Zhu (2020) Other interventions: Birkenmaier et al (2021b), Bunnell et al (2020), Collins and Nafziger (2019), Huang et al (2013), Huang et al (2022) Capacity building: Birkenmaier et al (2021a), Frey et al (2015), Loke et al (2017), Luukkanen and Uusitalo (2014) P4: Intervention to consumer well-being Public policy to wellbeing: Brackertz (2014), Despard et al (2020a, b), Huang et al (2015b) Financial socialization to wellbeing: Shim et al (2010), Fan and Chatterjee (2019) Financial education to wellbeing: Farnsworth et al (2011), Xiao and Porto (2017) P5: Financial Capability factors interactions Knowledge to behavior: Birkenmaier and Fu (2016), Chatterjee (2013),Despard and Chowa (2014),Despard et al (2020a, b),Kim and Lee (2018),Kim and Yuh (2018),,Lamb (2016),Loke (2017),Lusardi and Mitchell (2011), Luukkanen and Uusitalo (2019), Pellinen et al (2011), Roa et al (2019), Robb and Woodyard (2011), Seay et al (2017), Zhao and Zhang (2021) Knowledge to capability: Kagotho et al (2018) Behavior correlations: Bialowolski et al (2021a, b), Çera et al (2021), Fan (2021), Jorgensen et al (2017a), Lee and Kim (2020), Moreland (2018), Nam and Loibl (2021), Xiao and O'Neill (...…”

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confidence: 99%

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Financial capability: a systematic conceptual review, extension and synthesis

Xiao

Huang

Goyal

et al. 2022

IJBM

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PurposeThis study aims to examine the literature on consumer financial capability. By analyzing the research trends, theories, definitions and themes, the literature on financial capability is synthesized, and agenda for future research is suggested. A framework is presented that portrays the antecedents as well as the outcomes of financial capability and their interlinkages.Design/methodology/approachFollowing a systematic approach, the review is based on 215 articles published during January 2007 and–March 2022, retrieved from Scopus. It presents the definitions and theories of financial capability, publication trends, influential articles, prominent authors, prolific journals and countries publishing on financial capability. Using bibliographic coupling, the intellectual structure of the topic is explored, along with offering a framework through content analysis.FindingsThe bibliographic coupling analysis identifies four major clusters of research themes and capability theory appeared to be the most prominent theory. The synthesis draws upon five conceptual definitions of financial capability. Based on the discussion, in this review, financial capability is defined as an individual ability to apply appropriate financial knowledge, perform desirable financial behaviors and take available financial opportunities for achieving financial well-being. A conceptual framework delineates the synthesized literature and propositions based on this framework and relevant research are proposed. Finally, directions for future research are discussed.Originality/valueThis paper is an attempt to offer a comprehensive synthesis of the scholarship on financial capability and its conceptualization. It further proposes an extensive future research agenda. The study has implications for financial services providers relating to retail bank marketing.

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“…They find a linear decline in both FL level and cognitive abilities after the age of 60. Using the P-Fin index (all content areas), Yakoboski et al (2018) and Hasler et al (2017) measure the FL level of US adults. They show that, on average, it is low.…”

Section: Study Topics and Content Areasmentioning

confidence: 99%

Measuring financial literacy: a literature review

Ouachani

Belhassine

Kammoun

2020

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PurposeThe purpose of this paper is to review the main methods used in the literature to measure financial literacy (FL) of individuals.Design/methodology/approachThe paper begins by describing how the different items used to measure the FL level of individuals are constructed. Then, it focuses on how do researchers select the items. Finally, it reviews the different calculation methods used in the literature to assess the FL level.FindingsFL as a concept is tough to define and measure. Several studies focus on the definition and the measure of this concept. Different items are used in the literature and are mostly related to the study topics. The used calculation methods differ across the different studies.Originality/valueThis paper sheds light on the principal methodologies used in the literature to measure FL. It highlights the relationship between the items' content areas and the studies' subjects. Thus, this paper suggests guidance for future studies on measuring methods of FL.

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Financial Literacy and Wellness among African–Americans: New Insights from the Personal Finance (P-Fin) Index

Cited by 20 publications

References 1 publication

How the pandemic altered Americans' debt burden and retirement readiness

How the pandemic altered Americans' debt burden and retirement readiness

Financial capability: a systematic conceptual review, extension and synthesis

Measuring financial literacy: a literature review

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