African American Financial Socialization

Financial socialization, or who and how individuals were influenced financially, while growing up, has an impact on their current financial literacy and well-being. Little is known about African Americans’ financial socialization, so this study explored their financial socialization through the best and brightest of the community-educated African Americans; and then determine if the way in which they were socialized has an impact on their financial knowledge. The African American community is a heterogeneous community and differences in education levels would probably produce differences in financial outcomes. Primary data and 2015 FINRA survey data were used in this study. This study found that participants’ top three financial influences were parents, followed by life experiences, and then formal influences. Furthermore, those who were financial socialization by self-directed influences were more likely to be more financially knowledgeable than those who were financially socialized by other informal influences.