Household financial behavior

Dirk Brounen, Kees Koedijk, Rachel Pownall

Research output: Contribution to journalArticleScientificpeer-review

47 Citations (Scopus)


Greater personal responsibility toward financial decision-making is being advocated on a global basis. Individuals and households are encouraged to take a more active approach to personal finance. In this paper, we examine behavioral factors, which lead households toward savings and financial planning across a panel of 1253 Dutch households. In line with the available literature, we find that an individual's propensity to save decreases with age and is higher among the financial literate. Moreover, we find that saving behavior varies across generations, and is significantly dominant among baby boomers. This generation effect, however, weakens once we account for more individual specifics. Our results offer evidence for parental influence, and for the effects of the psychological and behavioral metrics of numeracy, self-efficacy, locus of control and future orientation. A good understanding of these personality variables helps to explain why some take financial responsibility while others do not.
Original languageEnglish
Pages (from-to)95-107
JournalJournal of International Money and Finance
Publication statusPublished - Dec 2016


  • household finance
  • financial literacy
  • personality


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