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Abstract: Based on data from the September 2017 National Financial Well-Being Survey, this project investigates the association between financial socialization in childhood and stock market knowledge in adulthood. Financial socialization is a process of introducing and advancing attitudes, values, and behaviors that promote financial well-being and literacy. For this project, stock market knowledge is considered as an understanding of the volatility of stocks, bonds, and savings, of the benefits of diversification, and of the long-term returns and possibility of loss on investments. The results of linear regression show that financial socialization in childhood is significantly and positively associated with stock market knowledge in adulthood. This association holds true regardless of possession of non-retirement investments, such as stocks, bonds, and mutual funds. The results imply that from a young age, children should be having discussions about family financial matters, spoken to about the importance of savings, and provided with a regular allowance and a savings account. This can lead to an overhaul of current economics and accounting curriculum in schools and tip the scales in favor of policy and institutional changes that promote financial education and foster financial confidence among young adults.
Project-Poster