More Interesting Insights from the Financial Capability Study

By: Jason Robinson, Fall 2015 Student Intern

The National Financial Capability Study compared the investing habits of men and women. In order to limit variables, the researchers compared unmarried men to unmarried women, and found that 21 percent of women and 24 percent of men own taxable investment accounts. The research also revealed that unmarried women are slightly more likely to consult a financial professional for savings and investment advice.    

To conclude their study the researchers employed regression analysis to measure a number of different variables’ impact on the likelihood that an individual will own a taxable investment account. Not surprisingly, household income had the strongest relationship with taxable account ownership. Some of the other strong factors included college degree, high financial literacy and age.

“Households in which the respondent has a college degree are 13 percentage points more likely than households in which the respondent does not have a college degree to own taxable investment accounts. And households where the respondent is classified as high financial literacy are 10 percentage points more likely than households where the respondent is classified as low financial literacy to own taxable investment accounts.”

Overall the data from the study revealed that there are certain groups who are “underrepresented in the retail investment world.” Some of this can be tied to lower levels of income in these groups, but the data also showed that differences remained even after the researchers adjusted for factors like income and education level.