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Improving Financial Well-Being for U.S. Individuals and Families

ROCKVILLE, MD — Over the past few years, the Bureau of Consumer Financial Protection has made studying financial well-being—i.e., how a person feels about his or her own financial security and financial freedom of choice—a central part of its strategy for improving consumers’ financial lives.  To help the Bureau, Abt Associates conducted an in-depth analysis of more than 6,000 U.S. adults to explore potential pathways to financial well-being. The results of this analysis are now available in the Bureau’s research brief Pathways to financial well-being and Abt’s report Understanding the Pathways to Financial Well-Being.   

Key Findings:

  • Financial skill appears to be more strongly tied to financial well-being than financial knowledge. For adults across the U.S., financial skill—the ability to find, process and use financial knowledge—is more closely related to financial well-being than general financial knowledge. In other words, building financial skill may be more effective in boosting financial well-being than building stores of financial knowledge (e.g., a general understanding of inflation or how compound interest is calculated). This supports the Bureau’s earlier findings that individuals learn about finances experientially, and it suggests the field of financial education might benefit from integrating experiential learning and other innovative education techniques that help build financial skill.  
  • Financial behavior is related to financial well-being. Favorable financial behaviors, such as positive money management practices and savings habits are indirectly related to financial well-being. Such financial behaviors may bring about a more positive financial situation for an individual—e.g., an improved credit standing, greater ability to make ends meet—which in turn, may lead to an improved sense of financial well-being. 

The analysis does not establish a causal relationship, but it points to a potential pathway where increased financial skill may lead to more positive financial behavior and thereby a better objective financial situation, culminating in improved financial well-being.

“While this study is exploratory, it lays the foundation for further research that can identify the drivers of financial well-being and the programmatic and policy interventions that can help individuals achieve greater financial well-being,” said Donna DeMarco, Abt principal associate and study director.

For detailed information about the study methodology and results, see Abt’s report:

For a summary of findings and their implications for the field of financial education, see BCFP research brief:


About Abt Associates
Abt Associates is an engine for social impact, dedicated to moving people from vulnerability to security.  Harnessing the power of data and our experts’ grounded insights, we provide research, consulting and technical services globally in the areas of health, environmental and social policy, technology and international development.
Amy Dunaway

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