TitleBuilding Financial Knowledge Is Not Enough: Financial Self-Efficacy as a Mediator in the Financial Capability of Low-Income Families
Publication TypeJournal Article
Year of Publication2016
AuthorsRothwell, D, Khan, MN, Cherney, K
JournalJournal of Community Practice
Pagination368 - 388
Date PublishedMay-10-2017

Policymakers in many countries have taken an interest in population-level financial capability. Limited empirical work has examined how constructs that makeup financial capability relate and how they function for individuals with low incomes. Using a national sample of low-income Canadians, we investigate relationships between financial knowledge, financial self-efficacy, and savings outcomes. Overall, we find that financial self-efficacy fully mediated the relationship between objective financial knowledge and postsecondary-education saving. The association between objective financial knowledge and retirement saving and emergency saving passed through financial self-efficacy. Efforts to promote financial capability need to focus on more than objective financial knowledge.

Short TitleJournal of Community Practice