Employees’ financial behaviors following the 2007–2009 financial crisis

Abstract

Low- and middle-income employees make up the bulk of potential participants in employer sponsored retirement plans; however, employers find it difficult to alter their savings behavior. Financial crises may have unintended positive effects on low-income employees’ behavior. Therefore, this study examined the effect of the 2007–2009 financial crisis on employees’ financial behaviors; through ordered logistic regression analyses of data from the Survey of Consumer Finances. Following the crisis, all employees’ and low-income employees’ savings behavior significantly improved. Moreover, all employees’ cash flow management behavior improved following the crisis, while it had no effect on low-income employees’ cash flow management behavior.