Financial Education Curriculum
Title
Development of the Executive Personal Finance Scale
Document Type
Journal Article
Publication Date
4-2007
Keywords
psychological barriers, financial education, executive function
Abstract
There is accumulating evidence that prefrontal systems play an important role in management of personal finances, based on studies using clinical populations, functional neuroimaging, and both subjective and objective neuropsychological measures. This study developed the Executive Personal Finance Scale (EPFS) as a specific self-rating measure of executive aspects of personal money management. The resulting 20-item scale had good reliability and showed four factors: impulse control, organization, planning, and motivational drive. Validity was evidenced by correlations with income, credit card debt, and investments. The EPFS also showed logical correlations with compulsive buying and money attitudes. Second-order factor analysis of the EPFS and other scales revealed two higher-order factors of personal finance: cognitive (e.g., planning, organizing) and emotional (e.g., anxiety, impulse-spending, prestige). The EPFS shows good psychometric properties, is easy to use, and will make a convenient complement to other research methodologies exploring the neural basis of personal finance management.
