The Cognitive Correlates of Financial Literacy in Older Adults

Abstract

Objectives: This study examined the cognitive correlates of financial literacy using a comprehensive neuropsychological battery, and whether education modifies the relationship between cognition and financial literacy. Methods: Sixty-six participants completed sociodemographic questionnaires, an assessment of financial literacy, and a neuropsychological assessment. Multiple linear regression models that controlled for age, sex, and education examined the main effects of cognitive measures that showed a significant bivariate association with financial literacy. Results: After correcting for multiple comparisons, the Crystallized Composite score (p =.002) and the Picture Vocabulary test (p =.002) from the NIH Toolbox, and the Multilingual Naming Test (p >.001) from the Uniform Data Set 3 were associated with financial literacy. Contrary to our hypothesis, education did not interact with cognitive measures when considering financial literacy scores. Conclusions: Findings suggest that vocabulary knowledge and semantic memory may play an important role in financial literacy in older age. Clinical Implications: Assessing vocabulary knowledge and semantic processes may help to identify older adults with lower financial literacy skills. Additionally, financial literacy interventions may consider targeting individuals with lower vocabulary knowledge and semantic processing skills.