Does Financial Knowledge at Older Ages Matter? Placing Income and Hardship in Context

Extant research offers limited understanding of the context in which economic resource and hardship at older ages are assessed. This study investigates the association between location-specific income security and hardship, and the moderating role of financial knowledge, using data from the Understanding America Study. We found that respondents with better location-specific income security were less likely to experience hardship and that financial knowledge strengthened the negative association between income security and hardship. Findings suggest that interventions to improve later-life financial knowledge may offer protection against hardship and that evaluations of later-life income adequacy may benefit from location-specific assessments of cost-of-living.

Automated summary

This study found that location-specific income security plays a crucial role in assessing economic resources and hardship in older age, and that financial knowledge can strengthen the negative association between income security and hardship. Interventions to improve financial knowledge in later life can provide protection against hardship, and evaluations of income adequacy may benefit from location-specific assessments of cost-of-living.