Foundations of Financial Well‐Being: Insights into the Role of Executive Function, Financial Socialization, and Experience‐Based Learning in Childhood and Youth

TLDR

During childhood and youth, individuals build the foundations for financial well‑being by acquiring knowledge, skills, attitudes, and personality traits that enable adult financial management. The article reviews literature from consumer science, developmental psychology, and allied fields to identify moments in youthful development when interventions can have the greatest impact and proposes a range of innovative strategies to improve financial education from early childhood through young adulthood. The authors conduct a literature review across consumer science, developmental psychology, and allied fields to pinpoint developmental moments most receptive to intervention. The review identifies promising avenues for influence at each developmental life stage, including novel approaches such as targeting executive function in young children, fostering financial attitudes through dual‑generation modeling for elementary and middle‑school students and parents, and teaching financial heuristics and practical skills to later adolescents and young adults.

Abstract

During childhood and youth we build the foundations for financial well‐being later in life, acquiring the knowledge, skills, attitudes, and personality traits that enable us to manage our finances as adults. This article reviews literature from consumer science, developmental psychology, and allied fields to gain insight into moments during youthful development when interventions are likely to have greatest impact. We find promising avenues for influence during each developmental life stage. Many present truly novel approaches to financial education—such as focusing on improving executive function in young children (critical despite lacking apparent “financial content”), emphasizing financial attitude development through dual‐generation financial modeling for elementary and middle school students and their parents, or intentionally teaching financial heuristics and other practical skills to later adolescents and young adults. Overall, this article proposes a range of innovative strategies to improve financial education, from early childhood through young adulthood.