The relationships of financial literacy with both financial behavior and financial well‐being: Meta‐analyses based on the selective literature review

Abstract This study conducted meta‐analyses of the relationships between financial literacy and both financial behavior and financial well‐being. Peer‐reviewed articles published on financial literacy in the field of consumer studies were collected by July 29, 2020. Fourteen articles were eligible for the meta‐analyses. The results showed positive relationships of financial knowledge with desirable financial behavior and financial well‐being. Our comparison of objective and subjective financial knowledge indicated that subjective knowledge had stronger relationships with both financial behavior and financial well‐being than objective knowledge. These two types of knowledge also had different paths to financial well‐being in that subjective knowledge had both direct and indirect effects on financial well‐being through financial behavior, whereas objective knowledge only had an indirect effect. The relationship between financial knowledge and financial behavior appeared stronger in cross‐sectional data than in longitudinal data. The implications of these results and possible directions for future consumer science research were discussed.