Microsoft Word Ed Horwitz Post Dissertation Fina docx

 Financial Education and Financial Well-Being  
 
When it comes to understanding the effects of financial education on financial well-
being, historical research is clearly mixed. Several historical studies have shown that greater 
financial knowledge improves financial behavior and decision making, which in turn have been 
associated with higher levels of financial well-being (Joo & Grable, 2004). Financial education 
confers decision-making skills, which can improve an individual’s ability to weigh alternatives 
in order to achieve personal financial goals and objectives (Bayer et al., 2008).  
 
However, other historical studies have found a negative relationship between financial 
literacy and financial well-being (Mugenda, Hira, & Fanslow, 1990). An explanation for this 
negative relationship is that the individual gains a clearer sense of their relative financial position 
through greater education and subsequently becomes less financially satisfied. In other words, 
those who are less financially literate are not aware of their poor financial position, and therefore 
perceive greater financial satisfaction than those who know better. In order to more clearly 
understand the relationship and implications between financial literacy and financial well-being, 
clarifying research is greatly needed.  
 Purpose 
 
The purpose of this research is to test the three primary aspects of the framework for 
financial literacy (Huston, 2010). Specifically, this research will test the effects of financial 
education on financial literacy, financial literacy on financial behaviors, and financial education 
on financial well-being. The mixed historical research and inconsistent findings on financial 

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education’s impact on financial literacy, and subsequent effects on behaviors and well-being, 
require expanded research to provide clarity. While literature has generally shown support for 
financial education programs and their associated improvements in literacy and positive 
behaviors, historical research falls short in establishing causal support for the effectiveness of the 
program itself (Martin, 2007; Garman et al., 1999).  
 
These essays seek to provide important and specific research in the area of financial 
education using quasi-experimental research methods. This research seeks to better understand 
the associations between financial education, financial literacy, financial behaviors, and how 
financial well-being is perceived, thus adding to the greatly needed body of research in this area. 
Through a greater understanding of these associations, financial education programs can be 
better positioned to help improve the levels of financial literacy among Americans and address 
the negative associated behavioral effects, such as lack of planning and saving for retirement.