 The Haves  The Have Nots

Financial literacy is the ability to understand

 How money works in the world.
 How someone earns money
 How someone manages money
 How he/she invests it (turn it into more)

More specifically, it refers to the set of skills and

knowledge that allows an individual to make
informed and effective decisions with all of their
financial resources
 Analyze and evaluate the existing methodologies utilized by
previous studies
 Analyze mathematical models on retirement security and financial
literacy for low income and minority communities.
 Identify regional data sources
 Run, Walk, or Buy? Financial Literacy, Dual-Process Theory, and
Investment Behavior
 Markus Glaser and Torsten Walther

 SELF-CONTROL, FINANCIAL LITERACY, AND THE

FINANCIAL BEHAVIORS OF YOUNG ADULTS
 Jodi C. Letkiewicz

 Cognitive Abilities and Household Financial Decision Making

 Sumit Agarwal and Bhashkar Mazumder
 Purpose: In this article, the authors examined or focused on the
following question: Why do some financially literate people
deviate from their “normal” investment strategy?
 Methodology: Descriptive analysis
 Conclusion: The major findings in this study was that financially
literate people were more likely to deviate from their investment
strategy if they tended to trust in their hunches.
 Purpose: The objective of this paper was to determine whether
financial literacy can moderate the effects that self-control has on
financial outcomes.
 Methodology: Descriptive analysis
 Conclusion: The major findings in this study were the strong and
consistent effects of conscientiousness on financial behaviors,
conscientiousness was positively related to wealth, there was
overwhelming evidence of the positive effect of conscientiousness
on financial outcomes and it appeared that financial literacy was
more beneficial when focused on longer term investments and
savings than on everyday management of money and budgets.
 Purpose: The primary objective of this study was to present new
empirical findings on the relationship between cognitive ability and
financial decision making by focusing on how financial mistakes
are linked to cognitive ability.
 Methodology: Empirical analysis
 Conclusion: The major findings in this study were, One
interpretation of these finding is that those with greater math ability
are more patient and therefore less likely to make financial
mistakes, that math ability is directly related to the ability to
understand financial concepts, to analyze tradeoffs and to make
relevant financial calculations.
 We have a large segment of the population who are economically
illiterate consumers and do not understand how to spend
intelligently, save wisely, invest, or do simple financial planning.
Yes, the credit card companies and other credit granters are
partially to blame for encouraging people to live beyond their
means, which creates financial stress for individuals and their
families. However, people who are poorly informed about money
matters have to shoulder some of the responsibility for their own
difficulties.
 Although some studies have shown some changes in spending and
saving behaviors of certain individuals, most studies conclude that
most individuals require extensive long-term counseling and or
training to adequately be prepared to make informed decisions
regarding their finances.
 Run, Walk, or Buy? Financial Literacy, Dual-Process Theory, and
Investment Behavior by Markus Glaser and Torsten Walther

 SELF-CONTROL, FINANCIAL LITERACY, AND THE

FINANCIAL BEHAVIORS OF YOUNG ADULTS by Jodi C.
Letkiewicz

 Cognitive Abilities and Household Financial Decision Making by

Sumit Agarwal and Bhashkar Mazumder