Selected Topics in Financial Literacy

Journal of Wealth Management, Vol.17, No. 3, pp. 47-57, Winter 2014

Robert H. Smith School Research Paper No. RHS 2515891

Posted: 20 May 2019

See all articles by John A. Haslem

John A. Haslem

University of Maryland - Robert H. Smith School of Business

Multiple version iconThere are 2 versions of this paper

Date Written: October 28, 2014


Financial literacy has become a major area of research in recent years, both in the investment and retirement literature with respect to the increasing complexity of financial products and need to save for retirement. Studies generally find individuals are financially uninformed and lacking in basic financial principles. This study discusses in depth research with detailed analyses of financial literacy, financial education, individual investment outcomes, genetic investment biases, and related issues.

A vast literature concerning investor financial literacy and education exists. The SEC’s [2012] study mandated under the Dodd-Frank Act provides a recent overall review and highlights existing levels of retail investor financial literacy and preferences for formats and timing of intermediary disclosures prior to making investment decisions, and more.

Lusardi and Mitchell [2013] assess research on financial literacy. Topics include theoretical research that casts financial literacy as an investment in human capital, how much financial knowledge individuals and groups have, the impact of financial literacy on financial decision-making, and what yet remains to be learned.

Fernandes, Lynch, and Netemeyer [2014] review research on financial literacy, financial education, and consumer financial outcomes. Meta-analysis is performed on financial literacy and financial education relationships in 201 non-redundant studies. Interventions to improve financial literacy explain only 0.10% of variance in financial behaviors.

Glaser and Walther [2014] combine psychology research with empirical findings on the usefulness of financial literacy for investment decisions. The personal behavior of individuals with high levels of financial literacy may depend on the prevalence of two styles of thinking in dual-process theories: intuition and cognition.

Collins [2012] finds the lack of financial literacy can reduce ability of individuals to make informed financial decisions. But, financial advice has the potential to substitute for lack of ability in financial decision-making. However, advice more often complements financial capability for individuals with higher levels of income, education, and financial literacy.

Keywords: financial literacy, financial education, retirement, retail investors, financial knowledge, financial outcomes, human capital, psychology research, investment decisions, intuition, cognition, informed financial decisions, income, education

JEL Classification: G02, G23, G28

Suggested Citation

Haslem, John A., Selected Topics in Financial Literacy (October 28, 2014). Journal of Wealth Management, Vol.17, No. 3, pp. 47-57, Winter 2014, Robert H. Smith School Research Paper No. RHS 2515891,, Available at SSRN:

John A. Haslem (Contact Author)

University of Maryland - Robert H. Smith School of Business ( email )

College Park, MD 20742
United States
202-387 2025 (Phone)

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