Financial Education and Financial Anxiety: Do Quality and Quantity Differ?

Abstract

This study used data from the 2018 National Financial Capability Study State-by-State Survey to examine the role financial capability plays in financial education and financial anxiety among a sample of consumers who received financial education (N= 4,824). Financial education was explored through two lenses, quantity and quality. Results of the mediation analyses within the structural equation models suggest that the quality of financial education is more impactful than the quantity on financial capability. The mediator, financial capability, has a significant effect on decreasing financial anxiety. The direct effect of additional hours of financial education appears to alleviate financial anxiety whereas higher quality financial education increases financial anxiety. The implications of these findings are that financial education programs should strive for quality to ensure financial capability; however, providing multiple touchpoints over time for financial education may ensure just-in-time learning and decrease financial anxiety for participants. In addition, educators can provide insights into how to cope with financial anxiety (e.g., problem-focused, emotion-focused, meaning-making, and social support).