Financial socialization and financial behavior

This chapter reviews how financial behavior, attitudes, and wellbeing are shaped by financial socialization that occurs throughout the lifespan. Parents are the primary source of this socialization, through both direct and indirect means. However, financial education, peers, and media are also a part of this process, including through shaping views toward materialism. Although research clearly supports all of these pathways, questions remain about the mechanisms involved and about the role of socialization later in adulthood. These issues could be addressed, in part, through research examining the differential role of authoritative, authoritarian, and permissive parenting on financial socialization or studies examining the impact of overparenting. Further, much of the existing research has been completed with samples of Western college students. Additional research examining financial socialization in other populations, such as in other cultures or among the non-college educated would provide a more complete understanding of the processes involved.