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Validating the Executive Personal Finance Scale with Financial Investments and Expectations in University Students
1Drexel University, USA.
Psychological Reports
|June 9, 2016
Summary
The Executive Personal Finance Scale (EPFS) effectively measures financial behaviors and future expectations in students. Its subscales correlate with savings, financial knowledge, and retirement income outlooks, supporting its validity.
Area of Science:
- Psychology
- Behavioral Economics
- Financial Literacy
Background:
- Assessing personal finance management skills is crucial for financial well-being.
- Existing scales may not fully capture the executive functions related to financial decision-making.
Purpose of the Study:
- To evaluate the psychometric properties and validity of the Executive Personal Finance Scale (EPFS).
- To determine if EPFS subscales correlate with objective financial behaviors and subjective financial expectations.
Main Methods:
- The EPFS was administered to 93 undergraduate students.
- Correlations were examined between EPFS subscale scores and financial behaviors (savings, CDs) and financial expectations (retirement income).
Main Results:
- Scores on Motivation drive, Organization, and Planning subscales were associated with savings accounts, bank CDs, and self-estimated financial knowledge.
- Impulse control and Motivation drive subscale scores were linked to expectations of a satisfactory retirement income.
Conclusions:
- The findings support the construct validity of the EPFS.
- The EPFS appears to be a valid instrument for assessing executive functions related to personal finance in young adults.
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