Disaggregating Financial Behaviors to Understand Which Behaviors Matter Most for the Subjective Financial Well‐Being of Airmen and Guardians

ABSTRACT It is well established that engaging in healthy financial behaviors is positively associated with subjective financial well‐being. Because financial behaviors are typically measured using aggregate scores comprised of a range of behaviors, less is known about which financial behaviors drive the association with financial well‐being. This measurement approach limits the available evidence that financial planners have to draw upon in providing specific financial behavior recommendations to clients. This study examined five financial behaviors (paying bills on time, staying within a budget, paying monthly credit card balances in full, setting aside money for an emergency fund, and investing for retirement) as separate predictors of financial well‐being in a sample of 6654 Service members—specifically, United States Airmen and Guardians; demographic variation in these associations was also examined (i.e., potential variation by rank, sex, marital status, and number of financial dependents). Although variation emerged in some demographic groups, all five financial behaviors were positively associated with financial well‐being. Setting aside money for an emergency fund and staying within a budget were the most robust predictors; thus, financial planners, educators, clinicians, and programs limited in time and capacity may do well to emphasize these salient predictors when working with clients—in this case, Airmen and Guardians.