Improving Measures of Financial Literacy, Wellness, and Attitudes among College Students
Improving Measures of Financial Literacy, Wellness, and Attitudes Among College Students
Project Summary
Current measures of financial/loan literacy, financial attitudes, and financial well-being are inadequate. Using rigorous psychometric methodology, we will develop a series of survey measures for various aspects of the NEFE Personal Finance Ecosystem. These measures will capture the nuance and complexity of these constructs for prospective/current undergraduate and graduate students. These measures could be used in national cross-sectional and longitudinal surveys, evaluation studies of financial well-being interventions, and smaller scale research studies.
Approach
Valid and reliable measures are needed in evaluation research. Interventions could be designed to identify and support students with lower financial literacy, using our measures as a pre- and post-test. Anderson and colleagues (2018) found lower financial literacy among marginalized populations such as racial/ethnic minorities and women. Targeted financial education programs might reduce negative outcomes such as student loan default (Hillman, 2014) that further perpetuate income inequality. Understanding college students’ baseline knowledge, attitudes, and perceptions will help to design effective financial aid entrance and exit counseling. New psychometrically valid measures could be widely used in college programming, such as a program run by student affairs staff to help students sharpen their financial knowledge. Institutional financial aid counselors have expressed interest in using these measures to better assess students' incoming financial knowledge, attitudes, and well-being, and how these may (or may not) change over the course of their college career.
Measurement & Metrics
Our measures of financial literacy, behavior, and wellness improve upon currently available measures in four major ways. First, current measures are generally too simplistic to provide adequate content coverage. Second, our measures are developed specifically for students, unlike some other financial literacy items (e.g., NPSAS items; Lusardi & Mitchell, 2011; Simone, 2015). Third, unlike most prior studies, we use Item Response Theory (IRT) to evaluate our measures (DeVellis, 2016). IRT relies upon stronger theoretical foundations than exploratory factor analysis. Finally, to the best of our knowledge, no prior studies have examined the measurement invariance of measures of financial knowledge, attitudes, and wellness.
Facts & Figures
25
people to be interviewed for the study
800
people pilot testing a survey
9,000
people administering a full survey