Intergenerational Transmission of Money Attitudes and Financial Wellbeing: Evidence From Parent–Child Dyads in an Emerging Country

Using data from 251 Indian parent–child dyads, we examine whether money attitudes of young adults reflect their parents' money attitudes. We also study whether parental money attitudes have a direct or indirect impact on the financial wellbeing (FWB) of their adult child. Confirmatory factor analysis yielded four distinct money attitudes viz. power‐prestige, retention‐time, distrust, and anxiety. Estimated PLS‐SEM path models indicate that parental money attitudes are positively related to corresponding attitudes of their children. Parental anxiety had an indirect negative association with the child's FWB, mediated via parental FWB and child's anxiety. Parental retention‐time had an indirect positive impact on the child's FWB mediated through parental FWB. Parental power‐prestige and distrust did not affect child's FWB. Model fit parameters indicate high levels of in‐sample validity and out‐of‐sample predictive ability. Our results provide novel evidence for the intergenerational transmission of money attitudes and its impact on FWB. Policy implications are discussed.