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How Am I Doing? Perceived Financial Well-Being, Its Potential Antecedents, and Its Relation to Overall Well-Being

How Am I Doing? Perceived Financial Well-Being, Its Potential Antecedents, and Its Relation to... Though perceived financial well-being is viewed as an important topic of consumer research, the literature contains no accepted definition of this construct. Further, there has been little systematic examination of how perceived financial well-being may affect overall well-being. Using consumer financial narratives, several large-scale surveys, and two experiments, we conceptualize perceived financial well-being as two related but separate constructs: 1) stress related to the management of money today (current money management stress), and 2) a sense of security in one’s financial future (expected future financial security). We develop and validate measures of these constructs (web appendix A) and then demonstrate their relationship to overall well-being, controlling for other life domains and objective measures of the financial domain. Our findings demonstrate that perceived financial well-being is a key predictor of overall well-being and comparable in magnitude to the combined effect of other life domains (job satisfaction, physical health assessment, and relationship support satisfaction). Further, the relative importance of current money management stress to overall well-being varies by income groups and due to the differing antecedents of current money management stress and expected future financial security. Implications for financial well-being and education efforts are offered. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Consumer Research Oxford University Press

How Am I Doing? Perceived Financial Well-Being, Its Potential Antecedents, and Its Relation to Overall Well-Being

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Publisher
Oxford University Press
Copyright
© The Author 2017. Published by Oxford University Press on behalf of Journal of Consumer Research, Inc. All rights reserved. For permissions, please e-mail: journals.permissions@oup.com
ISSN
0093-5301
eISSN
1537-5277
DOI
10.1093/jcr/ucx109
Publisher site
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Abstract

Though perceived financial well-being is viewed as an important topic of consumer research, the literature contains no accepted definition of this construct. Further, there has been little systematic examination of how perceived financial well-being may affect overall well-being. Using consumer financial narratives, several large-scale surveys, and two experiments, we conceptualize perceived financial well-being as two related but separate constructs: 1) stress related to the management of money today (current money management stress), and 2) a sense of security in one’s financial future (expected future financial security). We develop and validate measures of these constructs (web appendix A) and then demonstrate their relationship to overall well-being, controlling for other life domains and objective measures of the financial domain. Our findings demonstrate that perceived financial well-being is a key predictor of overall well-being and comparable in magnitude to the combined effect of other life domains (job satisfaction, physical health assessment, and relationship support satisfaction). Further, the relative importance of current money management stress to overall well-being varies by income groups and due to the differing antecedents of current money management stress and expected future financial security. Implications for financial well-being and education efforts are offered.

Journal

Journal of Consumer Research – Oxford University Press

Published: Jun 1, 2018

Keywords: perceived financial well-being; scale development; well-being

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