Publication year
2020
Citation Title
The lengthening transition to adulthood: Financial parenting and recentering during the college-to-career transition.
Journal Name
Journal of Family Issues
Journal Volume
41
Issue Number
9
Page Numbers
1626–1648
DOI
10.1177/0192513X19894662
Summary
Taking ownership of one’s financial behavior can be considered as one of the important milestones of emerging adulthood. This study examined how parental financial socialization and college students’ financial behavior changes over time. The findings indicate that parent-directed financial behavior declined during the college-to-career transition. However, college students’ financial behavior did not improve over time.
Key Findings
Parents’ explicit and implicit financial socialization tended to generally decrease during the college students’ college-to-career transition.
The decline in parents’ financial socialization was not accompanied with improvement in the financial behavior of college students.
College students belonging to lower income families reported lower level of parental financial socialization compared to those from high- and middle-income families; however, pattern of change in students’ financial behavior did not differ by income.
First-generation college students received lower level of financial parenting; however, pattern of change in financial behavior did not differ between first-generation college students and continuing-generation college students.
Implications for Military Professionals
Collaborate with financial education programs to emphasize importance of including parents in youth’s financial education
Develop activities to create positive and personalized relationships between parents and youth, especially during the period of transition to adulthood
Implications for Program Leaders
Provide workshops for parents of college-going youth that focus on how they can continue explicit and implicit financial socialization
Disseminate information regarding common difficulties youth face during the transition to adulthood and where individuals and families can find help for those problems
Implications for Policy Makers
Recommend collaboration between colleges and community-based organizations that support youth who may need additional support (e.g., first-generation college students)
Encourage the training of professionals to better identify parents who have difficulties managing financial roles and responsibilities
Methods
Data were drawn from a longitudinal study from year 2007 to 2016, which examined the formation of emerging adults’ financial behaviors and the association between early financial behaviors and later life success.
The final sample consisted of emerging adults who responded to three surveys that provided information on financial parenting.
An analysis of the data was done to determine how implicit and explicit financial parenting was linked with the financial behavior of the participants.
Participants
The sample consisted of 922 college-going students, and 35.5% of the participants were male. Fifteen percent of participants were first generation college students.
In the sample 67.8% of participants were White, 14.8% were Latino, 10.2% were Asian/Asian American/Pacific Islander, 2.7% Black, and 1.2% were Native American. The racial identity of remaining participants was not reported.
Of the sample, 30.9% of participants were low income, 24.5% were middle income, and 42% were high income; income data of the remaining 2.6% of participants were missing.
Limitations
The participants volunteered to participate in the survey related to financial behaviors. These participants may differ from other college going students who did not volunteer in ways that may affect the results and were not examined in the study.
The data were dependent on participants’ self-reporting of their financial behavior and parental financial socialization; only one source of information for both variables could introduce bias among the sample.
The measures used to assess college students’ financial behavior and parents’ financial socialization were not standardized, so, results should be interpreted with caution.
Avenues for Future Research
Collect data from young adults and their parents that measures changes in the type of interaction related to basic money management practices
Recruit a more heterogeneous sample of college students in terms of ethnicities, genders, and education levels, and nationalities so that the results can be better generalized to the larger U.S. population
Explore other sources of financial socialization (e.g., romantic partners) during emerging adulthood
Focus
Civilian
Target Population
Population Focus
Abstract
Using longitudinal data collected from a college cohort in the United States (N = 922), we examined the associations between systemic and structural factors (gender, race/ethnicity, family SES, and first-generation college status), financial parenting (teaching, and modeling behavior), and emerging adults’ financial behavior. We conducted a series of one-way repeated measure ANOVA analyses (GLM) to assess patterns of average change in financial parenting and financial behavior in the first year in college, fourth year in college, and two years after college and found evidence suggestive of recentering—a gradual transfer of responsibility during emerging adulthood from parent-directed behavior to self-directed behavior; however, the decline in financial parenting was not offset by an improvement in emerging adults’ financial behavior. Despite similar patterns of change, family socioeconomic status (SES), first-generation college student status, and gender influenced both financial parenting and financial behaviors at each time point. We discuss the findings and the implications on the timing and length of the recentering process.
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