Financial Socialization of Children and the Role of Parental Influence

• In Event: Moscone Center North Roundtable Session 11
  In Roundtable Session: Economics: The Room Where It Happened

Abstract

This paper focuses on the analysis of interviews with parents at the beginning of their children’s kindergarten year. It offers insight into how lower-income and higher-income families socialize their children on financial matters and with financial institutions. Conceptual framework of concerted cultivation versus natural growth suggests that middle-class families afford more opportunities by socializing children with out-of-school institutions helping them to be better prepared for future life decisions. Lower-income families usually use natural growth parenting style providing fewer chances to socialize with out-of-school institutions. Our results propose the opposite outcomes when applied to socialization with financial matters. The lower-income parents more openly talk to their children about scarcity of money and budgeting making them aware of the financial insecurity.

Authors

• Nadzeya Kardash, The University of Kansas

• Meghan Ecker-Lyster, University of Kansas

• Lauren Coleman-Tempel, University of Kansas