Consumer Finance Scales: Comparing English and Spanish Versions of a National Survey in the United States

Abstract

Financial scales were developed to understand and explain the financial behavior of adults in the United States using data from the 2018 National Financial Capability Study (NFCS) and the Spanish-Language Supplement. The main difference between them is that the Spanish-Language Supplement was composed only of Hispanics who prefer Spanish as their first language. Researchers combined various related questions using factor analysis (principal component analysis) to create the scales for financial anxiety, financial capability, financial readiness, financial self-efficacy, and financial technology. These scales and their corresponding scores allowed researchers to better measure specific concepts related to consumer financial management. Cronbach’s alpha showed scales were reliable and the Kaiser–Meyer–Olkin index confirmed the appropriateness of factor analyses. Except for financial capability, all financial scales using the 2018 NFCS State-by-State Survey were validated using the 2018 NFCS Spanish Supplement.