Assigment Parents_ Perceptions of Financial Technology to Support Financial

Chapter 1: Introduction to the Study

Introduction

Participants in the 2019 Personal Finance (P-Fin) Index survey, an annual measure

of financial literacy within the U.S. adult population, answered an average of 14 out of 28

questions correctly (Yakoboski, Lusardi, Hasler, et al., 2019). As troubling as this number

may appear, the implications extend well beyond a failing score. Individuals who lack

financial education are more likely to make late credit-card payments, to carry a card

balance each month, to be compulsive buyers, and are ill-equipped to navigate the

complex and evolving financial landscape, which can further exacerbate socioeconomic

inequality (Lin et al., 2019). It is against this complex backdrop of deficient financial

knowledge, negative behaviors and outcomes, and emotion-laden attitudes toward money

that adult-parents implicitly transfer these imprints to their children (Kim, Gutter, &

Spangler, 2017). For the 31% of parents who are comfortable and explicit in their

attempts to educate their 8-14 year-old children about financial matters, their

effectiveness may also fall short (T. Rowe Price, 2017). According the results of the 9th

Annual Parents, Kids, and Money Survey commissioned by T. Rowe Price (2017), 50% of

the respondents’ children noted that their parents confuse them or convey information

about finances that differs from what they may learn at school.

Therefore, it comes as no surprise that the financial literacy statistics associated

with 15-year-old teenagers are equally sobering. Across the 20 countries participating in

the 2018 Programme for International Student Assessment (PISA) financial literacy

survey, only one in seven 15-year-old students recognized the value of a rudimentary

budget and could apply common financial concepts to perfunctory, money-centered

situations that are of immediate relevance to their daily life (Organisation for Economic

Cooperation and Development [OECD], 2020). Accordingly, this group is not well

positioned to make impending significant and complex monetary decisions regarding

transportation, housing, employment, and post-secondary education that will affect their

future financial wellbeing (OECD, 2020).

There is, however, promising anecdotal evidence that expanding the role of

transaction-based financial technology (fintech) to include financial education may be an

affordable, scalable, and effective solution to the cross-generational financial literacy gap.

Arnold and Rhyne (2016) noted that the shift to fintech allows financial institutions to

reach a broader, more remote, yet technology-enabled client base. Access, however, is

only one lever in the addressing financial literacy gap. A natural extension of these

fintech services would include an authentic-learning component that accounts for the

knowing-doing gap, psychological considerations, life stages, and cultural factors that

shape financial behavior (Arnold & Rhyne, 2016). This assertion is further supported by

the Brookings Institution team of Kasman, Heuberger, and Hammond (2018), who also

highlighted the strong positive impact that experiential learning and informed parental

involvement may have on financial literacy and behaviors.

The clarion call for financial education combined with the promising research on

leveraging fintech applications to support authentic financial literacy experiences within

the family construct should not be ignored. Through this study, I sought to understand the

parents’ experience with and perceptions of using a private mobile budgeting and

banking application to support family financial socialization and the financial literacy

levels of the parent and child-users. The results of this study may expand on the

frameworks of family financial socialization and situated cognition theory and serve to

inform the role of parents, caregivers, and financial technology tools in the

personalfinance education space.

In the remaining sections of this chapter, I offer a background context for the

research topic including a summary of select literature, introduce the problem statement,

discuss the purpose of the study, state the research questions, and outline the conceptual

framework that is elaborated on in Chapter 3. I also summarize the nature of this study,

provide working definitions of unique terms used in the study, explore assumptions

within the context of the study, explain the scope and associated delimitations of the

study, and identify limitations related to the design and methodology. I close the section

by highlighting the significance of this research and summarizing the most salient points.

Background

In this study, I addressed a gap in the research related to fintech’s role in

supporting family financial socialization, situated cognition, and associated financial

literacy levels. I focused on how parents perceive fintech in terms of promoting

conversations, facilitating authentic learning opportunities, and supporting financial

literacy levels within the family construct. The following selection of peer-reviewed

articles related to financial literacy, the use of financial technology to support situation

cognition and education programs, and parental and family influence on financial

attitudes and behaviors speaks to the relevance of this study.

Existing research and media coverage is replete with dueling perspectives on the

effectiveness of classroom-based financial literacy education, the value of which is mired

by contrasting definitions of what constitutes literacy, inconsistent measurement systems,

varying levels of instructional rigor, and differences in teacher confidence and capability

with personal finance matters and content instruction (see Consumer Financial Protection

Bureau, 2019; Kaiser, Lusardi, Menkhoff, & Urban, 2020; Kaiser & Menkhoff, 2017;

Kasman et al., 2018; Walstad et al., 2017; Yakoboski et al., 2018). In their 2019 review of

the effects of youth financial education, the Consumer Financial Protection Bureau

(2019) stated that it is difficult to make priori assumptions about the effects of

classroombased efforts when the application of that knowledge may not be immediate or

measured. In effect, their review of school-based programs illustrates the disconnect

between financial knowledge acquisition and situated cognition whereby the personal

finance concepts learned in the classroom would be assessed through their authentic

application to financial transactions and decisions (see Consumer Financial Protection

Bureau, 2019).

What researchers do agree upon is that financial education begins in early

childhood and financial literacy imprints are imparted intentionally or tacitly by parents

through their narrative and behaviors (see Batty, Collins, & Odder-White, 2015; Hubler et

al., 2016; LeBaron, Rosa-Holyoak, Bryce, & Hill, 2018; Smith et al., 2018). Also, despite

the mired record of financial literacy efforts as evidenced by disparate grades ascribed to

state performance and comparative rankings among states and countries, there are some

common, positive inputs across school, home, and community-based curricula and

programs that support measured progress in financial literacy (Lin et al., 2019; OECD,

2020; Pelletier, 2017). Specifically, the purposeful and informed involvement of family

members, access to financial services and products, and the experiential learning

opportunities associated with handling money that are now ubiquitous on mobile and

digital devices have been collectively shown to support financial confidence,

responsibility, and efficacy (Aber, Morris, Wolf, & Berg, 2016; Amagir, Groot, Maassen

van den Brink, & Wilschut, 2018; Batty et al., 2015; Bosch, Serido, Card, Shim, &

Barber, 2016; Brown & Taylor, 2016; Fraczek & Klimontowicz, 2015; LeBaron et al.,

2019; LeBaron, Hill, Rosa, et al., 2018; Lusardi et al., 2017; Moreno-Herrero,

SalasVelasco, & Sanchez-Campillo, 2018; Smith, Echelbarger, Gelman, & Rick, 2018).

Financial literacy cognition begins in the home, may be augmented with

classroom curricula, but it is contextually and situationally applied and experienced

through in-person, and more often, online transactions using frictionless payment

systems. Arnold and Rhyne (2016), in a qualitative, multicase study, documented the

global shift from brick-and-mortar financial institutions to technology-based service

models. They discussed the potential implications of a parallel shift in financial education

delivery models away from classroom-based financial literacy toward an authentic,

technology-facilitated approach to building financial capability. Their prognostication that

fintech is positioned to play a pivotal role in supporting informed financial decisions and

associated literacy levels provided a perspective and lens for this study.

Similarly, Gudmunson and Danes (2011) noted that future expansion of their

family financial socialization theory could extend the definition of the family-social

environment to include digital media and schools. The development of this model and the

suggestion to include technology as an element of the family-social environment

acknowledges, by extension, the role of fintech in supporting financial literacy, which

was the basis of this study. Moreover, Hanson and Olson (2018) found that financial

literacy is positively influenced by individuals’ subjective assessment of their knowledge,

experience, and money-related conversations within the family construct. These results

supported my examination of parental perceptions, which served as a subjective measure

of differences in the nature and content of parent-child communication surrounding

financial transactions, and differences in financial literacy levels, which they attributed to

the fintech application.

In a meta-analysis, Kaiser, Lusardi, Menkoff, and Urban (2020) showed a

positive, measurable effect of financial education on financial behaviors. This research

suggested a linkage between behaviors and education, a relationship that I explored by

garnering perceived changes in financial literacy levels related to the transaction- and

communication-based activity on a fintech platform between parents and children. In a

complementary study, Kim et al. (2017) conducted a systematic literature review

designed to isolate research that focused on the process associated with family financial

decisions. Their summary analysis highlighted the opportunities for older children to

resocialize their parents’ financial behavior and literacy levels through the use of

technology applications (Kim et al., 2017). This finding pointed to the potential reciprocal

benefits of family financial socialization and fintech on the financial literacy levels of the

parent(s) and their child(ren), which helped inform my research questions.

Through a quantitative, developmental study, Smith, Echelbarger, Gelman, and

Rick (2018) identified the early-life stages during which attitudes about money are

shaped and whether those orientations can predict a child’s future spending behaviors.

Likewise, Kasman et al. (2018) noted that participating in or observing financial

transactions during childhood, such as accompanying a parent to a bank or hearing family

members talk about money, provide what they call “context and familiarity” that can

inform a child’s financial literacy levels and his or her facility managing money a decade

or more later as an emerging adult (p. 5). An age-appropriate, staged approach to

authentic learning is also advocated for by Mattar (2018) who cited Brown et al.’s (1989)

situated cognition theory as evidence for the need to account for the “social context of

interactions and tools” to create an environment for knowledge acquisition and learning

and, in turn, their systematic application (p. 6). In combination, this research aligned with

my premise that purposeful, money-centered conversations, involvement in

developmentally appropriate financial transactions, and financial literacy can be

supported through and facilitated by a fintech tool.

The existing body of literature points to the potential value of fintech in

supporting financial socialization processes within the family construct, promoting

productive money-oriented attitudes and behaviors, and elevating financial literacy levels.

This study connected the disparate research on family financial socialization; situated,

experiential learning; and financial literacy facilitated through and by financial

technology. Equally important, it may inform future policy and programmatic initiatives

related to purposeful parental involvement in financial education and the use of financial

technology to promote financial socialization, experiential financial learning, and literacy

levels in the home, classroom, and congregate care environments.

Problem Statement

The problem is that there is limited research exploring parent perceptions of the

use of fintech tools to support family financial socialization and the associated financial

literacy levels of parents and children. Researchers acknowledge that family socialization

during the formative childhood and adolescent years has an enduring effect on financial

attitudes and behaviors—positive or negative, intentional or unintentional

(MorenoHerrero, Salas-Velasco, & Sanchez-Campillo, 2018; Shim, Serido, Tang, & Card,

2015; Serido & Deenanath, 2016; Sundarasen, Rahman, Othman, & Danaraj, 2016).

Meanwhile, technology is redefining those socialization agents, and fintech is expanding

access to financial products and making their use frictionless (Blumenthal & Shanks,

2019; Fraczek & Klimontowicz, 2015; Sundarasen et al., 2016).

A long-standing body of research substantiates the pivotal role of parents in the

financial socialization process, and present-day studies warn that easy access to money

and credit, which fintech affords, may yield negative balances and outcomes for the

financially illiterate (Aber, Morris, Wolf, & Berg, 2016; Agnew, 2018; OECD, 2020;

Yakoboski & Lusardi, 2018). Accordingly, this study acknowledged the role of parents

and fintech in the financial socialization process. As recorded by Deenanath, Danes, and

Jang (2019), most of the existing literature on family financial socialization uses

retrospective data gathered from students’ experiences and interactions with parents

rather than from the parents themselves. In contrast to historic, student-centered

recollections captured in the prevailing literature, I gathered present-day perceptions of

differences in financial literacy levels that parents attributed to use of fintech in support

of conversations and situated, authentic learning.

Purpose of the Study

The purpose of this basic qualitative study was to explore parents’ experience with

and perceptions of the use of a fintech tool to support family financial socialization and

the associated financial literacy levels of parents and children. An open-ended set of

interview questions that focused on family financial literacy and money-based

conversations, interactions, and decisions between the parent and child(ren) was used to

capture differences in financial literacy levels that parents perceive as a result of using of

a family-managed, virtual bank (FMVB). The study site, hereafter referred to by the

pseudonym of FMVB, is an integrated mobile banking, budgeting, and payment

application that parents comanage with their child(ren), which is designed to develop

financial skills through hands-on experience.

FMVB markets itself as an educational prepaid card. The cards are used in tandem

with the FMVB mobile and web-based virtual family banking software where parent(s)

and child(ren) can establish budgets, manage chores, request and send money, split

payments, set and reward savings goals with interest, and view balances and activity.

Individually and collectively, the authentic functionality, educational objectives, and

family engagement that are foundational to this fintech platform align with the situated

cognition, authentic learning, and family financial socialization theories that underpinned

this study.

Research Questions

RQ1: What are parents’ experiences with the use of a fintech tool to interact with

their child(ren) about financial concepts and decisions?

RQ2: What are parents’ perceptions of how the use of a fintech tool supports

conversation and transaction-based financial socialization activities between a parent and

child?

RQ3: What differences in financial literacy levels do parents perceive based on

their tandem use of a financial technology application with their child(ren)?

Conceptual Framework

As captured in Figure 1, the conceptual framework for this study was rooted in

components of Gudmunson and Danes' family financial socialization theory (2011),

specifically how financial attitudes, behaviors, and associated financial literacy levels are

shaped intentionally and unintentionally through family dynamics and experiences. In

addition, situated cognition theory (Brown et al., 1989) undergirds the authentic,

digitalbased financial learning and decision-making context of the study. In effect, the

FMVB fintech tool was a proxy for the “cognitive apprenticeship” advocated for by

Brown et al. (1989, p. 18). Under this construct, students or child-subscribers in the

context of this study were enculturated into authentic activities (i.e., financial transactions

and decisions) and social interactions (Mattar, 2018). This socialization component

included moneycentered conversations with parents that were facilitated and necessitated

by the shared use of the FMVB platform. In combination, parent-child social interactions

situated in real-time and technology-supported financial decisions have the potential to

promote financial literacy levels.

Figure 1. Study’s conceptual framework. Fintech’s role in bridging, informing, and

supporting components of family financial socialization and situated cognition theories

and associated financial literacy levels. Adapted from Gudmunson and Danes (2011) and

Brown, Collins, and Duguid (1989).

I used this framework of family financial socialization and situated cognition to

examine and describe how parent-subscribers to the fintech tool operationalize these

theories through conversations, financial decisions, and transactions with their child(ren).

In Chapter 2, I more thoroughly explain this conceptual framework in relation to the

existing body of research and my study. The composite conceptual framework of family

financial socialization and situated cognition informed the basic qualitative approach.

Using this framework, I sought to describe the parents’ perceptions of a contemporary

phenomenon, the use of fintech as a socialization and education tool. The information

gathered through in-depth interviews was interpreted against this conceptual framework

and compiled into a rich narrative that showcases the distinct but analogous ways in

which financial socialization and situational cognition were operationalized by the fintech

subscribers in the study group.

The family financial socialization and situated cognition components of this

framework helped structure the research questions, which focused on conversations,

behaviors, and literacy levels. Specifically, financial socialization was explored in

research question RQ2. I asked the parents about their thoughts on and experiences with

the fintech tool in terms of supporting money-centered conversations and activities with

their children. The theory of situation cognition informed elements of RQ1 and RQ3,

which were framed to elicit perceptions about financial concepts, transactional decisions,

and differences in literacy levels attributed to the use of the fintech tool.

Nature of the study

This study employed a basic qualitative approach. As noted by Li (2018), the

strength of qualitative inquiry lies in its ability to provide meaning and context to the

perceptions and experiences of the study participants in relation to the phenomenon of

interest. Similarly, Clancey (1993) contended that perceptions are the precursor to

situated cognition since changes that individuals perceive in knowledge acquisition and

learning are socially and contextually constructed. For the parents in the study, their

perceptions served as a social- and situation-constructed measure of differences in

financial literacy levels they perceived in their child(ren) and themselves as a result of the

family-financial socialization and authentic, experiential learning facilitated by the shared

use the FMVB platform. The perceptions that were captured through in-depth, responsive

interviews and the resultant analysis and findings may inform future policies and

practices related to financial literacy education and the use of fintech.

Moreover, Ravitch and Carl (2015) asserted that qualitative inquiry is descriptive

and analytic. It seeks “complexity and contextualization,” which allows for an integrated

analysis of social, cognitive, and behavioral connections that influence, inform, and

potentially reform habitudes (Ravitch & Carl, 2015, p. 9). Given that the conceptual

framework for this study was based on socialization and situated cognition theories—the

interplay between people and context on financial literacy levels—a basic qualitative

approach accounted for these connections.

The research setting for this study was a parent-managed mobile and web-based

virtual-banking system. A small, purposeful, random sample of volunteers from the

subscriber base, 16 participants in total, served as the study group. This approach helped

ensure that the study was manageable and credible since participants were randomly

selected from the volunteer pool (see Patton, 2015; Ravitch & Carl, 2015). To ascertain

parents’ experiences with and perceptions of using this fintech tool to interact with their

child(ren) regarding financial concepts and decisions, I conducted in-depth, online

interviews.

The interview questions were informed by the theoretical framework and

emanated from the three research questions. The interview data helped discern parents’

perceptions of how or if the use of a fintech tool supports conversation- and

transactionbased financial socialization activities with their child(ren) and/or contributes

to perceived differences in financial-literacy levels.

I also used the conceptual framework for this study to interpret, categorize, and

summarize the data collected using a variation of a word table (see Baxter & Jack, 2005;

Yin, 2009). To mitigate bias, I kept a reflective journal of the rationale behind key

decisions throughout the design, implementation, interpretation, and reporting phases.

Also, as suggested by Yin (2009), I maintained a chain of evidence that captures the

progression from research questions to reporting.

Definitions

The following terms are uniquely defined in the context of this study:

Adolescent: Ages vary within the respective studies cited in this document. In

general, adolescents are 11–17 years old or U.S. middle- and high-school students.

Authentic or Experiential Learning: Authentic or experiential learning

encompasses discrete tasks and complex processes that replicate and are situated in

reallife activities which, as noted by Mattar (2018), blurs the distinction between learning

and application.

Emerging Adults: Emerging adults includes individuals ages 18-24 (Bosch et al.,

2016).

Family Financial Socialization: Family financial socialization encompasses the

financial attitudes, behaviors, and literacy levels that are shaped through money-related

conversations, transactions, and decisions that may be intentional, unintentional,

informed and/or misinformed that occur within the family construct during the formative

adolescent years and influence future financial behaviors during adulthood (Bosch et al.,

2016; Gudmunson & Danes, 2011).

Financial Literacy: Financial literacy, within the context of this study, extended

beyond personal finance content knowledge. It encompassed the attitudes, values, and

motivation to confidently apply knowledge, skills, and strategies to make informed

financial transactions and decisions in a variety of contexts (OECD, 2019).

Fintech or Financial Technology: Fintech includes companies such as FMVB that

provide financial payment, banking, and/or lending services to the consumer through

mobile and online platforms (Magnuson, 2018). However that definition is being

extended to encompass any technology innovation in the personal finance sector

including financial literacy and education( Kagan, n.d.; Lee, 2017).

Situated or Situation Cognition: A constructivist learning theory that stresses

authentic learning, context, and social interaction as the path toward constructing and

applying knowledge (Mattar, 2018).

Young Adults: Individuals ages 25-35, but the range is study dependent.

Assumptions

Following are two assumptions or beliefs that I as the researcher held to be true in

this study. First, I assumed that study participants answered the interview questions

honestly, which helped ensure that the data I collected accurately reflected their

perceptions. According to Walston and Lissitz (2000), as cited by (Patton, 2015), the fact

that I conducted online interviews may have reduced participant anxiety making it easier

to openly and accurately share information. In addition, study participants were advised

that any personally-identifiable information would be and is being kept secure and

anonymous, which should have allayed concerns about confidentiality and supported an

open discourse.

My second assumption was that parents subscribed to the FMVB platform to

promote responsible financial transactions and decision making within their child(ren).

Although this objective may have been one of the reasons, I acknowledged that parents

may have additional or perhaps higher-priority motivations for subscribing. Therefore, I

ensured that my open-ended questions examined my suppositions and parents’ objectives

related to this phenomenon.

Scope and Delimitations

The scope of this study was limited to the perceptions of parent-subscribers to the

FMVB fintech platform. It focused on perceived differences in factors related to financial

socialization and situational cognition (i.e., the conversations, behaviors, decisions, and

attitudes around money-related matters and literacy levels), which the parents attributed

to the use of the fintech platform. It did not focus on ancillary products or programs that

may have contributed to the differences noted by parents. Accordingly, questions were

framed explicitly and exclusively within the context of the fintech platform.

I identified two delimitations to this study. First, I confined this study to the

subscribers of the FMVB platform only. Although parents and children may be engaging

in financial socialization practices facilitated by other mobile budgeting and payment

platforms, securing site approval from a start-up entrant into this market was not viable.

New entrants into this fintech market niche may not have an established subscriber base

at the time of this study. Second, to help ensure the resultant study group was

manageable, I restricted the number of participants to 16.

Limitations

Some of the challenges associated with this study were inherent to the

datacollection method. As pointed out by Patton (2015), interviews are time-intensive,

and the “quality of the information obtained during an interview is largely dependent on

the interviewer” (p. 427). Accordingly, I devoted the requisite time to develop and test

questions, and to define and practice associated interview protocols to ensure my format,

engagement style, and questions elicited responses aligned to the research questions.

I also took proactive steps to mitigate any positive bias in my approach to this

study and the associated data analysis. Given that my volunteer work centers on

promoting financial literacy in the K-16 and underserved populations, I am optimistic that

fintech may be part of the solution to financial illiteracy. Accordingly, I disclosed my

commitment to financial education to the study participants, which also illustrated my

commitment to the study. I also kept a reflective journal in which I recorded my rationale

for key decisions I made related to data analysis and interpretation. My objective was to

memorialize my thought process and make it transparent.

Moreover, the context for this study was restricted to one fintech tool, which may

limit the generalization of this study’s findings to other contexts. Nevertheless, the

resultant findings, as they relate to the perceived value of fintech to support financial

literacy, may apply beyond the boundaries of this study.

Significance

Financial literacy is an economic and social imperative that underpins individual

and societal well-being. One in five 15-year-olds does not have the fundamental skills

and knowledge needed to perform and understand the implications of everyday financial

activities (OECD, 2017). Some researchers attribute this growing trend to the lack of

physical connection to money (Lusardi, Scheresberg, & Avery, 2018). In fact,

kindergarteners, children as young as age five, are making cashless transactions. They

buy lunch daily in school cafeterias by scanning a card or entering a code, and make

purchases on their mobile and gaming devices that result in microtransactions that show

up on a parent’s credit card (“Economics of Microtransactions in Video Games,” 2017).

Among 8-14 year-olds, 18% carry a credit card as an authorized user on a parent’s

account and that percentage is expected to continue to rise as online transactions and the

number of cashless stores and restaurants grows (T. Rowe Price, 2017).

The low level of financial literacy among the Millennial and Generation Z

population and the growth in cashless mobile transactions reinforces, according to

Yakoboski and Lusardi (2018), the importance of equipping this large generation with the

knowledge and skills that are needed to make financial decisions in the digital era.

Fintech, according to Maurer, Wrapp, Middleton, Dzokoto, and Fan (2019), may be the

gateway that acknowledges end-user preference for digital mobility, provides access to

financial management tools, and supports financial stability. In effect, this evolving

digital landscape presents an opportunity for fintech developers to address the literacy

gap by redefining the content, form, and access modality to financial education

(Yakoboski & Lusardi, 2018).

Gudmunson and Danes' (2011) family financial socialization theory supports the

contention that the financial literacy deficit needs to be addressed in the formative

childhood and adolescent years when financial attitudes and behaviors are shaped

intentionally and unintentionally through family dynamics and experiences. Equally

noteworthy was Agnew’s (2018) assertion that having children engage in routine financial

transactions may facilitate parent-child, money-based conversations. Therefore, a

comprehensive approach to addressing financial literacy, which my study represents,

acknowledges that children are making cashless transactions at a young age, affirms the

parents’ role in the financial education and socialization process, and supports the

development of foundational financial concepts and productive behaviors that will

transcend life stages.

In addition to expanding on the theoretical framework of family financial

socialization, this study may also provide some level of validation to Brown et al.’s

(1989) theory of situated cognition. Situated cognition theorists posited that authentic

activities and associated social interactions, those that occur outside the classroom

learning environment, support deeper learning and the transference of conceptual

knowledge to alternative situations (Brown et al., 1989). Within the context of this study,

the use of a financial technology application coupled with parental involvement provided

an authentic learning context and social interaction deemed by Brown et al. to support

improvements in learning which, is this instance, centered on financial literacy.

Accordingly, the insights from this study have the potential to define the role of fintech in

the personal-finance education space and add to the existing research on financial

socialization (Gudmunson & Danes, 2011).

Although Lusardi et al. (2018) stressed that fintech is not a substitute for financial

literacy they, alongside Serido and Deenanth (2018), acknowledged that fintech’s

potential to support financial parenting and literacy levels does holds promise. Students

who engage in conversations with their parents about money-related matters and who feel

their academic efforts are supported by their parents tend to have higher financial literacy

scores (OECD, 2017). These findings indicate that parents can play an important role in

addressing the financial literacy gap, and harnessing fintech to support financial

conversations and applied learning opportunities may be the lever that makes a

statistically-significant and sustained impact on financial literacy levels (Kasman et al.,

2018; Lusardi, Yakoboski, et al., 2018).

Summary

In this section, I outlined the social and economic implications of financial

illiteracy, which was the genesis of this study. I highlighted that the prevailing research

recognizes the pivotal role of parents in the financial socialization process and alludes to

fintech’s potential role in promoting financial inclusion and literacy levels. I noted that

despite these acknowledgements, the problem remains that there is limited research

exploring parents’ present-day perceptions of the use of fintech tools to support family

financial socialization and the associated financial literacy levels of parents and children.

Accordingly, this study may add to the existing literature associated with the family

financial socialization and situated cognition framework while promoting conversations

around the use of fintech to advance financial literacy levels. In Chapter 2, I provide an

in-depth analysis and synthesis of the literature and the conceptual framework.

Chapter 2: Literature Review

Introduction

Chapter 2 provides a comprehensive analysis and synthesis of the prevailing

literature related to the central topic of this study, the use of fintech to support financial

socialization and literacy levels within the family construct. The chapter begins with an

explanation of the approach to the literature search. It is followed by a discussion of the

challenges associated with defining and measuring financial literacy, which segues into

an examination of the conceptual framework. Finally, I provide a detailed review of the

relevant research, including a discussion of family financial socialization processes

alongside associated, resultant, and supporting factors which include life-stage and

intergenerational considerations, authentic/ experiential learning, financial confidence,

financial inclusion, financial education, and fintech.

The prevailing problem is that there is limited research exploring the role of

fintech in supporting family financial socialization and literacy levels. The purpose of this

qualitative study was to explore parents’ experience with and perceptions of the use of a

fintech tool to support family financial socialization and the associated financial literacy

levels of the parent(s) and child(ren). Current research points to promising outcomes

associated with the expanded use of transaction-based fintech as an experiential learning

tool to bridge the cross-generational financial literacy gap. However, much of the existing

research centers on a retrospective analysis of personal accounts of financial socialization

practices that parents and their emerging-adult children recall from the adolescent years.

Moreover, much of the research related to fintech focuses on financial inclusion, scaling

access to banking and financial markets through technology, and on the saving and

spending behaviors of those currently using fintech applications. There is gap in the

literature regarding the tandem use of fintech by family members to support present-day

financial socialization practices and literacy levels.

Literature Search Strategy

I restricted my search primarily to peer-reviewed journal articles that were written

in English, published in the last 5 years, focused on financial literacy, highlighted parental

and family influence on financial attitudes and behaviors, and referenced the use of

financial technology to support personal finance education. The keywords of financial

literacy, money management, personal finance separate from and coupled with family

education, parent education and technology, applications were combined into search

strings and used within Education Source, Academic Search Complete, ERIC and

ABI/INFORM. To secure research articles related to my conceptual framework, I used

the same databases and entered the following search strings: family financial

socialization, situated cognition, and situation cognition, including and excluding the

word theory.

Conceptual Framework

The combined theories of situated cognition and family financial socialization, as

reflected in Figure 1, captured the reciprocal- and social-learning opportunities that may

be facilitated by the FMVB fintech platform (see Brown et al., 1989; Gudmunson &

Danes, 2011). The sections that follow examine the existing research in relation to this

conceptual framework and how it applies to the purpose, significance, data interpretation,

and reporting associated with this study.

The Formative Years of Financial Socialization and Literacy

Family climate, money scripts, and childhood involvement in money-based

decisions have a cumulative effect on financial attitudes and long-term behaviors. In a

longitudinal study of 1,511 college students at a public U.S. university, Bosch, Serido,

Card, Shim, and Barber (2016) administered the Financial Identify Scale survey during

the students’ first and final years of enrollment. The goal was to isolate contextual

predictors of the financial identity of this study group. Specifically, the research team

examined and found that socialization agents (e.g., parents, friends, colleagues at school

and work) affect financial attitudes and perceived levels of control over finances in

emerging adults (Bosch et al., 2016). They also suggested that future researchers might

focus on early and middle adolescence to more fully understand how identification

formation in these pivotal years shapes an individual’s financial self-efficacy as an

emerging adult (Bosch et al., 2016). This recommendation informed the types of

questions I posed to the parent study-participants to capture their perceptions of their

adolescent child’s current level of self-efficacy and confidence.

Bamforth, Jebarajakirthy, and Geursen (2018), during focus groups with 47

students in three Australian universities, noted that students’ observations of how their

parents managed money, the mantras they heard about savings and spending growing up,

and their involvement in and autonomy to make financial decisions as a child influenced

the students’ money-management behavior and attitudes throughout their college years.

Hubler, Burr, Gardner, Larzelere, and Busby's (2016) survey work with 715 couples

further illustrated the long parental reach on financial dispositions. The researchers found

that current family financial stressors within the study group had carried over from

childhood and will likely be passed from one generation to the next despite improvements

in income and education levels (p. 385).

Similarly, Jorgensen et al. (2019) found that of all the early influencers on a

child’s financial vision including formal education, media, and friends, parents have the

greatest effect in three areas: setting financial goals, planning and acting, and

understanding the time value of money. These findings resulted from semistructured

qualitative interviews with a convenience sample of 128 undergraduate students ages

1830 who were enrolled in a family finance course and 17 of their parents and eight

grandparents. Moreover, Bosch et al. (2016) confirmed their hypothesis that a wellformed

financial identity during childhood years facilitates the transition from

“adolescent financial dependency to adult financial self-sufficiency” (p. 417).

Interestingly, Smith et al., (2018) found the level of child’s frugality, even at a

young age, affected their purchasing decisions more than the desire for a given item.

These findings were based on responses from 225 children, 5-10 years of age, and one of

their parents to a questionnaire designed to determine the children’s frugality orientation,

which the researchers termed spendthrift-tightwad. Collectively, these representative

findings reinforce the extant literature that marks early-childhood through adolescent

years as the formative period when parent communication, behaviors, and the child’s

level of involvement in financial decisions serves to shape attitudes about money and

future, adult financial self-sufficiency (see Bosch et al., 2016).

Parents as Financial Socialization Agents

Parents, intentionally or not, exert the most influence on their child(ren)’s

financial behavior development (Moreno-Herrero, Salas-Velasco, & Sánchez-Campillo,

2018; Shim, Serido, Tang, & Card, 2015). Underscoring the gravity of this role,

Sundarasen, Rahman, Othman, and Danaraj (2016) positioned parents as the primary

socialization proxy for their adolescent child’s financial knowledge accumulation and

habitual patterns (p. 143). Serido and Deenanath (2016) defined the shape and form in

which parents influence financial knowledge and skills under the following contexts:

• Financial socialization – what parents do and say to convey information.

• Parenting style – the way financial information is conveyed.

• Social class – the range of opportunities and experiences parents provide that

involve financial decision making.

In fact, students who consider their parents as their primary source of financial

information outperformed their counterparts by 27 points on the PISA financial literacy

assessment (OECD, 2020).

However, not all financial socialization modeling, which affects financial

knowledge, behaviors, and well-being is intentional and positive, and the quality of the

relationship with the child affects that dynamic (Gudmunson & Danes, 2011; Jorgensen,

Rappleyea, Schweichler, Fang, & Moran, 2017). Compounding this potential challenge is

the fact that there are no clear strategies to strengthen family financial socialization and

normalize the taboo surrounding money discussions, which transcends socioeconomic

and ethnic/cultural backgrounds (Gudmunson et al., 2016; Palakvangsa-Na-Ayudhya,

Pongchandaj, Kriangsakdachai, & Sunthornwutthikrai, 2017).

Explicit Financial Socialization

When parents are intentional in their financial instruction and provide purposeful

opportunities to engage their children in money-centered decisions and transactions, their

efforts can yield positive and sustained financial orientations, behaviors, and literacy

levels. Kagotho, Nabunya, Ssewamala, Mwangi, and Njenga (2017), as part of a

randomized control trial, analyzed data from 90-minute interviews with 3,965 lowincome

Kenyan students enrolled in Grades 5-7. Their objective was to determine the relationship

across financial socialization, financial management skills, and savings. They found that

children in a household where the parent/caregiver engaged them in financial decision-

making were more likely to save. Perhaps more noteworthy, the researchers identified

that the process of engaging in financial decisions and activities may partially offset low

family financial socialization (Kagotho et al., 2017).

To identify how or if financial literacy levels are affected by parental involvement

and communication, Hanson and Olson (2018) conducted a correlation and regression

analysis on responses from 96 college students to a composite survey comprised of

questions from the Revised Family Communication Pattern survey (Ritchie & Fitzpatrick,

1990) and the 2015 National Personal Finance Index. They analyzed the family

communication patterns for those participants who answered “do not know” rather than

guess the answer to a financial literacy question (Hanson & Olson, 2018). Their findings

suggested that financial literacy confidence levels and formal financial education may be

enhanced by direct parental involvement. On a cautionary note, Fraczek and

Klimontowicz (2015) asserted that “only educated young parents can show their children

a correct attitude to family finance and an appropriate way of making financial decisions”

(p.77). However, they did add that financial education can help to change habits and

orientations.

As part of their Emerging Adult Financial Capability Study (EAFCS), Jorgensen

et al., (2017) examined the role of attachment insecurity, locus of control, and parental

financial communication on the financial behavior of 321 emerging-adult college students

through the lens of family financial socialization theory. Their findings were consistent

with their prediction that a decrease in purposive financial communication with parents

reduced a student’s sense of control and aligned with their increased level of insecurity.

Expanding on the role of explicit financial parenting in relation to knowledge, skill, and

confidence levels, Serido and Deenanath's (2016) literature review touted the need for

parents to consciously involve children in daily transactions such as buying groceries and

paying bills. By explicitly modeling the norms, attitudes, and behaviors associated with

financial decisions, parents are supporting the development of their child’s financial

values (Serido & Deenanath, 2016).

As part of the rationale for their qualitative, multigenerational study, LeBaron et

al. (2019) highlighted that existing research on parental influence has focused almost

exclusively on discussions and modeling, which they deem implicit teaching. The

researchers suggested that parent-facilitated experiential learning is the third potential

method of financial socialization that parents are using (LeBaron et al., 2019). Through

line-item open coding of interviews with 90 families, with a least one emerging adult

“child” enrolled in a college family finance class, the team identified consistent themes.

The first group of themes included observed behaviors: working hard, managing money,

and spending wisely. The second category centered on knowledge and dispositions:

learning financial skills, acquiring financial values, and becoming independent (LeBaron

et al., 2019). The researchers advocated that experiential learning supports the transfer of

observed behaviors and attitudes, translates discussion and knowledge into practice, and

builds financial confidence through the learning opportunities inherent in handling money

(LeBaron et al., 2019).

As part of their analysis of a subset of questions from the 10-wave Flourishing

Families Project, researchers LeBaron, Holmes, Jorgensen, and Bean (2020) found that

the now emerging adults, who were overtly financially educated by their parents as

children during the initial years of the study, reported a greater frequency of healthy

financial-management behaviors. The team did note that this finding was based on a

retrospective response to one question that allowed for multiple, overlapping answers and

that future research should include a more precise measure of what constitutes overt

financial education (LeBaron et al., 2020).

Deenanath et al. (2019), in a study they heralded as unique in its examination of

the present-day effect of purposive and unintentional financial socialization on the

financial knowledge and behavior of high-school students, found that students who

communicated with parents about money and who were confident in making money

decisions tended to display a greater number of healthy financial behaviors. Interestingly,

the researchers considered communication with parents about money as an unintentional

socialization factor since it does not involve the tangible exchange of money. Whereas,

earned income and access to money from parents are considered purposive attempts at

financial socialization (Deenanath et al., 2019).

However, their findings suggest that the common, purposive attempt to

indoctrinate children to money management through allowances may not be effective in

supporting financial knowledge and healthy financial decisions. They posited that since

the money transfer from parent to child happens outside of the financial marketplace and

excludes the experience of earning money, the resultant lack of situated cognition

negatively affects students’ self-reported financial knowledge (Deenanath et al., 2019).

Similarly, Lanz, Sorgente, and Danes (2019), as part of multi-informant study with 160

college-age emerging adults and their parent(s), found that economic enmeshment, the

implicitly transferred sense that the family’s money and assets belong to everyone,

actually discouraged the emerging adult from pursuing employment and negatively

affected their financial well-being.

The challenge of translating financial cognition and conceptual knowledge into

action was also cited by Riach, McDonald, and Grant-Smith (2017) in their findings from

semistructured interviews with 123 university students during which they explored the

interrelated themes of education, employment, relationship, and finances. They found that

authentic, real-time financial transactions and decisions had more influence on financial

behavior than abstract concepts that parents may attempt to explain (Riach et al., 2017).

As defined through the aforementioned studies, explicit, parent-guided financial

socialization is intentional, purpose-driven, and activity-based, which is in direct contrast

to the unintentional, implicit transfer of financial knowledge, skills, and values. Yet,

regardless of intent, these socialization behaviors–overt or tacit, observed or experienced–

have a lasting effect, positive or negative, on a child’s financial well-being.

Unintended Consequences

Financial parenting happens explicitly and implicitly on a daily basis through

observation, conversation, and dollar-driven decisions that may or may not involve the

children. The implicit socialization, which is likely unintentional, occurs more frequently

versus conversation-based, overt teaching and may be more impactful than parental

attempts to teach financial concepts (Britt, 2016). In fact, parental attempts to provide

direct financial guidance and instruction to children may be thwarted by the quality of the

relationship between the parent and child. In their seminal work on family financial

socialization, Gudmunson and Danes (2011) suggested that family conflict that is

unrelated to finances will leach into attempts to engage children in learning opportunities

related to personal finance. Accordingly, the resultant attitudes and behaviors from those

exchanges may create a negative imprint.

Building on this notion that financial imprints are engrained at young age, Britt,

Klontz, and Archuleta (2015) in their conceptual framework for financial therapy called

for a conscious change in the scripts between the primary financial influencer, which is

the parent, and the child. Similarly, Serido and Deenanath (2016) noted that this implicit

transfer of money scripts and the associated knowledge, skills, and values is subject to

misinterpretation by young children and misapplication in adolescent and emerging-adult

years. In fact, Riach et al. (2017) found that emerging adults may overtly reject their

parents attempts to influence their spending habits and intentionally act counter to the

financial values the parents were attempting to impart. Although the students in their

study acknowledged that this behavior may be counterproductive to their financial

wellbeing, they characterized their parents’ financial lessons as nagging, which generated

an emotional trigger and justified an oppositional response (Riach et al., 2017).

Gudmunson et al. (2016) explained that financial socialization is a process that everyone

experiences; it is the collective tone and behaviors, coupled with the accuracy of that

indoctrination that can have a positive or detrimental effect on the individual and the

larger financial and economic ecosystem.

Not surprising, a parent’s self-perception of their financial knowledge and overall

confidence level may inhibit or support their willingness to engage in explicit teaching

opportunities with their children. Serido and Deenanath (2016) recommended that one

way to change the narrative around money is to help parents understand that “good

decision-making transcends content knowledge,” which may bolster their self-confidence

and efficacy (p. 297). This prevailing belief system among parents that they need to be a

financial content expert perpetuates the taboo nature of the topic which, according to

Jorgensen et al. (2017), results in parents underestimating what their 9-17-year-olds are

cognitively ready to process (LeBaron, Hill, et al., 2018).

Holding a contrary opinion, Moreno-Herrero et al. (2018), based on their analysis

of the OECD data associated with the countries participating the 2015 PISA assessment

on financial literacy, stated that the opportunity to improve financial literacy among youth

is predicated in part on the average level of financial knowledge of the family members.

Conflicting positions are also evident in the work of Bamforth et al. (2018) and Brown

and Taylor (2016). The former posited that the money-management behavior of parents is

mirrored by their children, while the latter reported that parental saving behavior does not

influence the decisions to save by their children. Perhaps LeBaron, Rosa-Holyoak, Bryce,

Hill, & Marks (2018) have found the middle ground between these opposing positions—

children learn financial practices and attitudes by watching and imitating their parents,

but they also learn financial principles through the consequences of their own decisions

and experiences.

Financial Socialization Agents Expand with Age

Within the sphere of financial education, parents, by default, are the primary

educator, lead influencer, and decision-maker for emerging adults. In particular, a child’s

financial values and future orientation as it relates to college are indelibly shaped by

parents and their implicit and explicit modeling of values and behaviors (Blumenthal &

Shanks, 2019; Brown & Taylor, 2016; Jorgensen et al., 2019). As Bosch et al. (2016)

found during their bookend survey of college students as freshmen and seniors, the

subjective norms instilled by parents alongside explicit communication remained the

primary influence on students’ financial behaviors.

Similar results were recorded by Sundarasen et al. (2016) who analyzed responses

from 200 post-graduate students to a questionnaire measuring financial literacy and

parental norms. They found that parental involvement, passive or active, was of greater

influence on an adult-child’s approach to money management more so than financial

experience (Sundarasen et al., 2016). Likewise, Batty, Collins, and Odders-White (2015)

noted that the financial attitudes that children develop early are based on observations of

their parents, which serve to inform their financial behaviors over their lifetime.

Combined, these findings illustrate the engrained effect that parents have during the

formative adolescent years on their child(ren)’s lifelong dispositions toward and decisions

regarding money.

Financial socialization can be viewed as an assimilation and learning process that

evolves over life stages with socialization agents shifting from lead to supporting roles.

Gudmunson and Danes (2011) contended that social interactions at any given point in

one's life—whether it be with parents, caregivers, friends, teachers—had implications for

financial socialization. More important, these agents of socialization did so pervasively

and with long-lasting effects. Shim et al. (2015) supported Gudmunson and Danes’

socialization theory and expanded the scope of financial agents to include the social

constructs of the classroom, self-directed learning, and media.

Te’eni-Harari (2016) as part of his interviews with 103 first-grade children

determined a positive correlation between a child’s involvement in saving money (ISM)

and parent and peers’ attitudes toward saving. Te’eni-Harari also noted that the influence

these socialization agents had on the elementary children was not necessarily focused on

financial behavior but on the more nuanced process of socialization and involvement. The

complex nature of socialization in relation to money was also discussed in Jorgensen et

al.'s 2019 study, which was designed to determine the influence of parents on the

development of a child's healthy financial vision for life. Jorgensen’s team emphasized

that children emulate the behavior of those with whom they socialize, and it is the

reinforcement of those behaviors that shapes learning (Jorgensen et al., 2019). Using

a structural equation model to analyze the objective and open-ended responses to a

questionnaire administered to 530 tenth-grade students, Rudeloff (2019) found that of all

the informal financial learning opportunities involving various socialization agents (i.e.,

parents, siblings, financial institutions, media, and personal experience), those provided

by parents resulted in higher student-child financial literacy levels. Test scores across

daily money-management areas related to saving, payments, loans, and insurance were

positively correlated to the intensity level that the studentparticipants assigned to their

parents’ informal financial lessons (Rudeloff, 2019). Learning from siblings, however,

resulted in lower scores in the dimensions measuring saving, payments, and loans

(Rudeloff, 2019). Rudeloff surmises that this pronounced negative correlation is a product

of comparable deficits in financial knowledge between the study participants and their

sibling(s).

Fraczek and Klimontowicz (2015) undertook a questionnaire-based, quantitative

study involving 181 business and economic students that yielded complementary

findings. Using students’ responses to two questionnaires, they correlated factors

associated with financial literacy levels and decision-making processes to the students’

actual behavior in the banking market. The researchers found that when making a

decision involving complex banking products, young adults defer to their social network

of family and friends, individuals who may be ill-equipped to provide informed guidance

(Fraczek & Klimontowicz, 2015).

This tendency to defer to social networks was also identified by Sundarasen et al.

(2016). This research team stated that without a strong foundation, young adults may

succumb to peer pressure in attempt to keep up with a financially unsustainable lifestyle

(Sundarasen et al., 2016). To offset the potential deleterious effects of peer-based,

uniformed advice, LeBaron, Rosa-Holyoak, et al. (2018) emphasized that children,

throughout their lives, need regular and relevant financial conversations. Reinforcing that

position, Serido and Deenanath (2016) suggested that parents should capitalize on

opportunities to shift into a peer-advising role with their older children that “encourages

deeper thinking about the role of finances” (p. 294). As noted by LeBaron, RosaHolyoak,

et al. (2018), parents end up paying literally for their children’s financial illiteracy, and

the historic notion of learning from mistakes is not a viable option in today’s economy.

Xiao and Porto (2017) advanced a compensatory strategy that involves tailoring

educational materials to a particular life stage thus augmenting or offsetting the quality of

socialized financial learning.

Also related are the findings from Hubler, Burr, Gardner, Larzelere, and Busby

(2016), who used structural equation modeling to analyze the intergenerational transfer of

financial stress in a sample of 715 couples. Their findings supported the hypothesis that

family stressors including finance do “spill over onto the child” (p. 385). Perhaps more

disconcerting is the assertion that a predisposition toward stressing about finances, even

with a strong personal balance sheet, carries forward through multiple generations, along

with latent attitudes about risk and trust (Bhattacharya, Gill, & Stanley, 2016; Hubler et

al., 2016).

Recommendations from numerous studies dating back to the foundational work of

Gudmunson and Danes (2011) and as recent Britt (2016) and Moreno-Herrero et al.

(2018) highlighted the potential of cross-generational, reciprocal learning whereby family

members engage together in financial education and decision-making processes that are

designed to support sustained, positive socialization. Also noteworthy and directly

supporting this study is the limited research exploring the real-time effects of the

intergenerational transfer of money dispositions and behaviors, and the recurring question

as to why formal financial education and applied learning opportunities fail to include the

family (Bhattacharya et al., 2016; Britt, 2016).

Situated Learning, Social Interaction, and Financial Literacy

The value of providing children with age-appropriate opportunities to practice and

apply financial decision-making as part of an explicit and holistic approach to financial

socialization is a recurring theme in the literature. Brown et al. (1989) in the formation of

their theory of situated cognition maintained that knowledge is inextricably situated in the

activity and the social construct through which is it developed and applied. Their

assertion that applied knowledge and learning, versus knowing sets of discrete

information, can only take shape in the context in which it is used is supported by leading

and emerging researchers in the financial socialization and financial education sphere

(Brown et al., 1989).

To better understand how children applied metacognition to daily money

decisions, Lee, Koh, Cai, and Quek (2012) asked 136 fifth-grade students to describe

their own life experiences and the nonlinear process they used to navigate financial

scenarios with multiple alternatives. This approach, as highlighted by Lee et al. (2012),

aligned with Brown, Collins, and Duguid’s (1989) theory of situated cognition, since it

elicited the children’s financial reasoning in context. In affirming studies, Gudmunson

and Danes (2011), Gudmunson, Ray, and Xiao (2016), and LeBaron et al. (2019) stressed

that experiential learning supports the transfer of observed financial behavior and

attitudes and translates discussion into practice. In effect, knowledge or cognition may be

individually or socially constructed, but learning is situationally based.

Supporting this contention, are the findings and recommendations from the

research work of Shim et al. (2015), and Tang, Ning, and Peter (2015). The latter team, as

part of their regression analysis of the 3597 young adults who participated in a national

longitudinal survey, identified a positive correlation between and across financial

experience, knowledge developed through financial education, and the parents’ “financial

sophistication” (p. 135). They emphasized that it is hard to determine the direction of the

causality and therefore the effectiveness of any one of the co-determinants of financial

literacy cannot be evaluated in isolation. Fraczek and Klimontowicz (2015) also

underscored the combined importance of positive family financial socialization and

experiential learning that supports informed conversations and systematic decision

making.

The design of these life-stage-informed experiential learning opportunities is key

to ensuring that children develop self-reliance and individual responsibility when it

comes to money. As part of their expansive literature review, Gudmunson et al. (2016)

emphasized that applied learning opportunities need to mirror the experience that children

will have as part of the larger financial and economic systems, which is not the case with

most household allowance and grade-based financial reward systems. Serido and

Deenanath (2016) also mentioned in their literature review of financial parenting

practices that young children who have experience with handling money show a greater

understanding of pricing and credit models in comparison to their counterparts with no

money management or transaction experience.

Similarly, LeBaron, Hill, et al. (2018) and LeBaron, Rosa-Holyoak, Bryce, Hill,

and Marks (2018), stated that students need to be given opportunities to manage their

own finances in order to develop self-confidence, internalize the money scripts they hear,

and apply the practices they were taught. However, unlike Gudmunson et al. (2016),

LeBaron, Rosa-Holyoak, et al. suggested that payment for academic performance may be

appropriate, as it does reflect the pay-for-performance systems found in the workplace.

On an aggregate basis, these studies speak to the value of introducing authentic learning

opportunities in the family financial socialization process — experiences that reflect the

digital saving, spending, and borrowing environments that children are and will be

navigating.

Not surprising, the multi-generational and millennial participants in the studies

conducted by LeBaron, Hill, et al. (2018) wished they had been given more financial

responsibility during their formative childhood years, reinforcing the position that

knowledge without application is not effective. Participants also indicated they would

benefited from more candor about finances and the family’s financial situation and vowed

to break the cone of silence that stifles open conversations about money with their own

children (LeBaron, Hill, et al., 2018). Hanson and Olson (2018) alluded to the potential

benefits of multi-generational and reciprocal learning between adults and children that is

facilitated through experiential learning. However, Moreno-Herrero et al. (2018)

cautioned that parents socialize their children differently and limited experience, financial

resources, and/or access to financial products and services can hinder the financial

literacy development of the children.

As part of a longitudinal study dating back to 1979, Tang (2017) examined the

intergenerational transfer of explicit modeling of financial behaviors among 2,520 young

adults. This sample included the children of females who initially participated in the

Bureau of Labor Statistics NLSY79 study as 10-17 year-old adolescents (Tang, 2017).

Using a generalized structural equation model, Tang found that parents directly affect the

financial behaviors of young adults through purposeful practice and modeling of

productive behaviors related to managing credit, debt, and cash flow. Tang invited future

studies to explore the interplay among financial socialization efforts that include

purposeful practice. Teng’s recommendation bolstered my rationale for discussing

reciprocal differences in financial literacy levels that the parent-participants in my study

perceived based on their tandem use of the FMVB fintech platform with their child(ren).

Experiential Financial Learning and Situation Cognition

As part of an analysis of effective financial capability interventions and

schoolbased education programs, Amagir, Groot, Maassen van den Brink, and Wilschut

(2018) alongside Arnold and Rhyne (2016), determined that active learning and practice

makes financial behaviors habitual, and the effectiveness of those practice sessions and

resultant financial literacy levels can be amplified with parental involvement. Likewise,

Bosch et al. (2016) encouraged parents to include practical opportunities to involve their

children in financial decisions, thus creating a path toward self-sufficiency. Several

researchers have identified the effectiveness of experiential learning as the mechanism

through which students can develop and apply financial knowledge (Batty et al., 2015;

Gudmunson et al., 2016; LeBaron et al., 2019). However, the long-term impact of just-in-

time and experiential approaches to financial socialization, alongside the aggregate value

of multiple hands-on activities versus discrete financial activities, has yet to be fully

examined.

Amagir et al. (2018) highlighted several studies that showed the

statisticallysignificant effect that multiple instructional methods supplemented by take-

home activities had on the financial knowledge of elementary-age children. Farinella,

Bland, and Franco (2017), in their regression analysis of the 2012 OECD financial

literacy survey results for the 15-year-old student-participants, found that students

benefitted more when money management is learned outside of school or embedded in an

existing course, versus a stand-alone class. Their finding stands in contrast to the results

of a pre- and post-evaluation of a financial literacy camp conducted by Bhattacharya et al.

(2016).

They found that direct financial instruction raised financial literacy scores approximately

12% points in a group of 93 eighth-grade students from Title I schools that are eligible for

free and reduced-lunch funding. Equally noteworthy is the fact that their study yielded no

evidence showing that the use of incentivized or prefunded saving plan, which all the

participant-families had, affected the campers’ test scores (Bhattacharya et al., 2016).

Further confounding the discussion about the effectiveness of formal financial

education interventions vis-à-vis purposeful parental socialization efforts are two articles

from Zhu (2019) and Zhu, Yu, and Chou (2019). The experimental study associated with

these published works involved 247 fifteen-year-old students, 59 of whom were in the

control group and did not participate in the 10-week financial education course. The

objective was to investigate the effect that formal, school-based financial education has

on implicit and explicit parental socialization practices and financial knowledge (Zhu et

al., 2019). The results, as reported by Zhu, Yu, and Chou indicated that the financial

knowledge acquired during the course, specifically information related to spending and

saving, topics that are most relevant to high-school students, did not alter behaviors.

Moreover, the school-delivered financial education had a mixed effect on financial

parenting, yielding a positive effect on tacitly promoted financial norms and a negative

effect on financial concepts parents conveyed through intentional teaching (Zhu et al.,

2019).

Smith et al. (2018) proffered one explanation of these contradictory findings on

the interplay of financial socialization, inclusion, education, and literacy levels. They

suggested that children’s responses to questions about spending and saving may be

sensitive to the context in which they are framed and the unique opportunity cost they

assign to a given financial decision (Smith et al., 2018). Addressing this need to consider

the situational construct in which financial knowledge is applied and measured, Prevett,

Pampaka, Farnsworth, Kalambouka, and Shi (2020) developed a framework for assessing

financial self-efficacy in practice that may serve as a proxy of financial literacy levels.

Their two-phase, mixed-methods study with a subset of 171, 16-19 year-old students

highlighted the faulty link between classroom-resultant financial knowledge and

confidence and its anticipated transfer to financial capability and actual practice (Prevett

et al., 2020.). These conflicting studies speak to the ambiguous definitions of financial

literacy and the inconsistency in evaluation tools. Albeit unintentionally, they serve as a

testimonial to the need to situate financial literacy assessments in its applied context.

Situation Cognition Facilitated by Fintech

Clancey, a foremost researcher and pioneer at the nucleus of constructivism,

systems theory, situated cognition, and artificial intelligence contends that learning

processes are neural, social, and bidirectional (Clancey, 2008). He asserts that relationship

dynamics, such as those found within the family structure, influence perceptions,

knowledge conception, and actions indicative of applied learning (Clancey, 2008). He

also argues that constructivist epistemology is the basis of situated cognition in that all

learning is a complex interplay among memory, perception, and the social environment

(Brown et al., 1989; Clancey, 1993). In parallel, this study acknowledged that the

conception and application of financial literacy knowledge and skills is a reciprocal

process that occurs within the social, family environment. Moreover, the basic qualitative

methodology of this study drew forth and accounted for parents’ perceptions as a

representative measure of reciprocal changes in money-centered interactions and personal

finance knowledge and skills that they attributed to the use of FMVB. Li (2018), in

his study of financial instruction through situation simulation technology, used what was

characterized as a “highly-simulated experimental environment” to replicate the

authentic, interrelated contexts in which students will apply finance and accounting

principles (p. 73). Noteworthy and relevant to this study are his conclusions that an

authentic, technology-based environment allows learners to situate and apply their

knowledge to moral dilemmas and unexpected events inherent in the world of finance

where judgment needs to be practiced and exercised (Li, 2018). Similarly, the family-

centered, authentic financial technology that FMVB represents aligns with the goals of

artificial intelligence knowledge acquisition and situated simulation technology through

which learning is construed as an active, willful process and whereby knowledge is

constructed, experienced, and guided in stages (Clancey, 2008; Li, 2018).

Fintech may serve as the gateway that transitions users from acknowledging

financial capability gaps to seeking out personal finance education resources (Maurer,

Wrapp, Middleton, Dzokoto, & Fan, 2019). In a pilot study of 27 Millennial and Gen Z

participants ages 18-34, who were asked to use one of five budgeting and investing apps,

Maurer et al. sought to gain insight on the “use and usability of the apps…, the

educational strategies or curricula of the apps…, and the apps’ effectiveness with regard

to people’s financial practices” (p. 7). Though pre- and post-use interviews and a

voluntary focus group, the researchers found that the apps raised participants’ awareness

of their budgeting or investing behavior, may not have changed it, but did spur the

participants to see out financial education resources, which included YouTube videos or a

bank representative (Maurer et al., 2019). The researchers noted that Millennials, their

children, and Gen Z are the target market for this category of personal finance

management apps, which may serve as the singular source of financial education that

young consumers have or will receive (Maurer et al., 2019).

In this study, the FMVB child-subscriber may seek financial information from the

parent, reinforcing the socialization and reciprocal learning processes. For the parent,

personal finance resources within the FMVB platform include the collateral education

materials on the website, blog, or the extended financial socialization agents on the

subscriber Facebook page. When fintech is positioned as a personal finance management

and education platform it may serve as or facilitate the dynamic feedback loop that

Kasman et al. (2018) use to describe the interrelationship across core financial concepts,

psychological/social factors, experiential learning, and financial behaviors. Although

fintech is poised to encompass all the components of a comprehensive and relevant

financial education experience, including fostering family socialization and positive

money-management strategies using leading-edge digital tools and products, its potential

and impact has not been fully examined.

Literature Review Related to Key Concepts

Financial Literacy

The distinction between the often-interchanged terms of financial literacy and

financial capability extends beyond semantics. It dictates the focus and scope of

associated research. Historically, the definition of financial literacy focused on knowledge

and dispositions—separate from, but in relation to, financial behaviors and decisions.

This behavioral-focused construction of financial literacy was used by Te’eniHarari in his

2016 interview-based study of 100 first-grade students where he explored their

involvement in savings activities and associated attitudes, intentions, and behaviors.

Fraczek and Klimontowicz (2015), in their study of 181 business and economic students,

examined the correlation between financial knowledge and resultant financial behaviors

in the banking market. In this instance, conceptual knowledge of personal finance or

financial literacy was a precursor to application. Similarly, Kaiser and Menkhoff (2017)

in their meta-analysis of 126 studies, investigated the effect of financial education on

improvements in literacy and behavior, two distinct factors. Once again, financial

conceptual knowledge was segregated from its use.

In contrast, Amagir, Groot, Maassen van den Brink, and Wilschut (2018) took an

all-encompassing view of financial literacy. As part of their systematic literature review

of financial-literacy education programs for children and adolescents, they defined

financial literacy in terms of three components: knowledge and understanding of

concepts; skill or behavior associated with applying that knowledge; and the attitudes,

confidence, and self-efficacy to act (Amagir et al., 2018). However, Xiao and O’Neill

(2016), in their analysis of the 2012 data from the National Financial Capability Study,

emphasized that unlike financial literacy, financial capability is a more comprehensive

term that accounts for financial knowledge and overlays behavior and self-efficacy.

Against this backdrop of conflicting, inconsistent, and interchangeable use of

financial literacy versus capability, Xiao and Porto (2017) also noted the subjectivity

involved in identifying and measuring what constitutes financial knowledge, literacy,

behavior, capability, and well-being. As part of their mediation analyses of the 2012

National Financial Capability Index, which was designed to determine the effect of

financial education on financial capability factors, the researchers identified the

cumulative and symbiotic relationship of the component elements of financial literacy

and capability and the challenge associated with isolating and examining one dimension

(Xiao & Porto, 2017).

The lack of a standard operating definition of financial literacy makes it difficult

to isolate what drives financial behaviors and decision making. Is it beliefs, attitudes,

knowledge, skill, confidence, access to financial products, cultural and social norms – or

some composite thereof that is situation specific? This inconsistency also makes it

challenging to compare results across measurement instruments and research studies

(Allgood & Walstad, 2016; Kaiser et al., 2020).

Echoing the call from the OECD to collect high-quality, comparable data on

international financial-literacy levels in the young an emerging-adult populations, Hanson

and Olson (2018) advocated for measuring the effectiveness of financial education efforts

by focusing on application, behavior modeling, and cross-generational family

interactions. Further extending the list of measurement factors, Tang and Peter (2015)

asserted that financial education, personal experience, and parents’ financial experiences

are co-determinants of financial knowledge acquisition and that you cannot evaluate the

effect of one factor independent of the others.

For measurements that account for participation in formal financial-education

programs, Kaiser and Menkhoff (2017) and Xiao and O’Neill (2016) recommended that

the quality of the inputs—e.g., teacher training, curriculum, and implementation—be

included in financial-literacy assessment criteria. Likewise, Xiao and Porto (2017)

suggested that an accurate measure of financial knowledge acquisition needs to include

objective and subjective or self-reported measures of literacy, behavior, capability, and

satisfaction to determine the impact of financial education programs on their intended

audience. Although Shim et al. (2015) conducted a longitudinal study of 1,511 college

students during their first and fourth years, which was a self-reported survey of

socialization factors, they called for a more balanced approach that includes an objective

set of measures of financial behavior beyond perceptions and self-identification.

Morgan, Huang, and Trinh (2019) advocated for an even more expansive

definition that considers the medium through which much present-day financial

knowledge is constructed and applied—that being technology. They highlighted the fact

that most definitions of financial literacy or capability fail to account for the digital

component, specifically an individual’s confidence with and skill in using fintech, which

is rapidly replacing cash- and brick-and-mortar-based money transactions (Morgan et al.,

2019). This team suggested that surveys should include aspects of digital financial

literacy, which were not found in widely-used financial-literacy questionnaires prior to

the May 2020 release of the 2018 PISA financial literacy assessment (Morgan et al.,

2019; OECD, 2020). Likewise, Grohmann and Menkhoff (2017) contended that

aggregate measures of financial literacy ought to account for and be weighted according

to financial-inclusion levels, or access to and use of financial systems including digital

access and platforms.

Irrespective of the label, the financial literacy and/or capability research landscape

is replete with conflicting definitions that do not fully acknowledge nor account for the

evolving digital financial landscape. The application of these inconsistent and limited

definitions to the research environment serves to exacerbate the challenge of measuring

financial competency and the effectiveness of education and interventions designed to

bolster factors that contribute to financial literacy. Accordingly, a comprehensive

operating definition and measurement of financial literacy would include all

codeterminants—the external and internal factors influencing knowledge, skill, attitude,

confidence levels, and resultant money-management behaviors. Operationalizing that

definition, however, poses another challenge, particularly as it relates to measuring the

effect that financial education has on youth financial behavior (Amagir et al., 2018).

Granted, my research could not and did not identify or encompass all the variables that

affect financial literacy. Nevertheless, the purposeful focus on parents’ perceptions of

changes in the nature and content of money-centered conversations and financial literacy

levels attributable to the use of fintech tool was responsive to the call for a more holistic,

digitally-supported, and socially-situated approach to financial measurement and

education.

Family Financial Discussions, Activities, and Literacy Levels

Financial literacy levels are not clinically derived metrics devoid of social,

situation-specific, and affective influences. They are a composite of the long-term effects

of spoken and unspoken family truths surrounding money, formal education, peer and

media influence, and the situational factors and learned behaviors surrounding financial

decisions. Agnew (2018) selected three experiences captured in existing financial literacy

questionnaires that could be considered contributing factors to financial knowledge and

behavior—allowance, savings accounts, and conversations with a parent. His findings,

from a sample of 1,247 children ages 14 and 15, pointed to the discussions among the

parent and child as being the most influential on savings behavior and financial literacy

scores (Agnew, 2018). Alekam, Salleh, and Mokhtar (2018) in their analysis of the

relationship between behavior, family/parent effects, and peer influence on the financial

literacy levels of 500 Malaysians ages 18-34 found a positive effect, not causal, between

the three factors and literacy levels.

The pivotal role of parents in relation to financial literacy levels was also

validated in three separate studies published in 2018. The results reinforced prior research

showing that emerging adults who talked to their parents about money at a young age

have higher levels of financial independence, financial awareness, and overall

capability/literacy levels. (Bamforth et al., 2018; LeBaron, Rosa-Holyoak, et al., 2018;

Moreno-Herrero et al., 2018). Nevertheless, what students learn from these interactions is

not equally accurate, productive, or positive. These representative studies point to the need

to identify financial topics not sufficiently taught or modeled by parents; to influence the

nature and content of family socialization recognizing the social and emotional components

of those conversations; and to acknowledge that family, as defined by the emerging adult,

is the primary lever to lift financial literacy.

Effects of Education and Parental Involvement

Although the majority of classroom-based financial education efforts and the

wealth of free curriculum resources target high-school and college-level students, those

efforts may be too late. Based on pre- and post-assessment literacy scores associated with

700 fourth and fifth graders, 380 of whom participated in a personal-finance-curriculum

intervention and 320 who were part of the control group, Batty et al. (2015) found a .77

effect size, almost of full standard deviation, in the number of additional correct answers

logged by those in the personal finance class. In their findings, Batty et al. noted that

financial habits are formed early and family influences have already taken hold by age 7,

the point at which children begin to experience growth in the areas of planning,

decisionmaking, and self-control. Te’eni-Harari (2016) also noted that it is between the

ages of 6 and 12 that a child begins to understand the value of saving and its link to future

opportunity.

Meanwhile, children as young as age four are being socialized through money

scripts and observations, and are influencing or engaging in purchases especially those on

or related to digital and gaming devices (Fraczek & Klimontowicz, 2015; Kim et al.,

2017). When reporting what they termed “novel findings”, Smith et al. (2018) found that

children as young as age five could articulate their feelings about saving and spending

and relate their personal dispositions to their money behaviors (p. 455). Teaching

earlyelementary children about the value of money has the added benefit of working with

a blank slate, rather than attempting to reshape an emerging adult’s financial identity and

poor financial habits, which were established more than a decade earlier (Batty et al.,

2015; Bosch et al., 2016; Farinella et al., 2017). These conversations about the proper

timing, content, format, and delivery mechanism for financial education are further

confounded by the same set of considerations surrounding financial inclusion or access to

monetary resources and products.

Financial Inclusion Has Mixed Effect on Financial Knowledge

Financial inclusion is the banking and financial-market equivalent of situated

cognition. At its most fundamental level, financial inclusion is measured by access to and

use of a bank account and debit card (Grohmann & Menkhoff, 2017; Moreno-Herrero et

al., 2018). For adolescents, financial inclusion provides a contextually-relevant

opportunity to apply the financial knowledge, habits, and dispositions fostered through

financial socialization and formal education. In the countries of Belgium, Canada, and

Spain, Moreno-Herrero et al. (2018) identified a causal, positive influence between

financial inclusion and financial literacy. Students who had a bank account scored 10

points above peers who did not, thus supporting the idea that giving children access to

financial services at a young age supports experiential learning and measurable changes

in literacy levels (Moreno-Herrero et al., 2018).

Grohmann and Menkhoff (2017) in their analysis of the S&P Global Financial

Literacy Data determined that high financial literacy levels had a causal relationship with

financial inclusion with the reverse effect also plausible. On a micro-level, Te’eni-Harari

(2016) indicated that providing children access to financial products gives them the

hands-on experience that will contribute positively to their savings orientation and future

financial behaviors. Jorgensen et al. (2019) showcased instances where parents created

their own family bank to help their children learn to save and plan for their future. These

are powerful examples of the how financial inclusion on a micro- and macro-level can

shape individual and aggregate literacy levels alongside access to and design of financial

products.

The use of banking products facilitates concrete financial discussions within

families, while low financial inclusion limits the conversations about finance-related

opportunities and potentially undermines a child’s financial confidence and vision

(Blumenthal & Shanks, 2019; LeBaron, Rosa-Holyoak, et al., 2018; Serido & Deenanath,

2016). Supporting this contention, Kagotho et al. (2017) and Sinha, Tan, and Zhan (2018)

emphasized the negative compounding effects of low financial literacy and banking

system participation rates within financially at-risk classes, which limit financial

socialization opportunities across generations.

Even though historic studies have shown a positive relationship between bank

accounts and financial literacy, Moreno-Herrero et al. (2018) noted an area for future

exploration centers on the association between experience with money matters, financial

products, and students’ financial literacy levels. It is this void in the current research that I

partially addressed through my research. I reported on parents’ experience with the use of

a mobile budgeting, banking, and payment application (FMVB) in tandem with their

children and perceived changes in the nature and level of family financial socialization

and financial literacy.

Financial Inclusion and Socialization with Fintech

The proliferation of mobile-banking, payment, investing, and peer-lending

applications signals what is likely the inevitable transition to a predominantly cashless

society. It also points to the potential of positioning fintech as the cognitively-situated

learning environment for children and parents that can support positive financial

socialization and literacy levels. Fintech provides parents the opportunity to model

productive money-management and decision-making behaviors for their children (Kim et

al., 2017; Rosa-Holyoak, Marks, LeBaron, & Hill, 2018). That however, must be a

conscious decision, since the electronic nature of these processes does not allow children

to visibly see their parents setting aside physical currency for saving or using checks to

pay bills (Rosa-Holyoak et al., 2018).

Expanded financial inclusion enabled through technology does present

implications related to financial behaviors and literacy levels (EY FinTech Adoption

Index, 2017). Elsinger et al. (2018) as part of their literature review sought to determine

whether fintech will redefine financial literacy. They concluded, as did Arnold and Rhyne

(2016), that fintech may exacerbate financial literacy deficiencies, making gaps more

problematic given the lack of face-to-face advice to support transactions (Elsinger et al.,

2018). Equally concerning are the cautions repeated by researchers who stressed that

frictionless transactions, those not involving physical currency, make it easy to engage in

impulse spending, overspend, and consequently overdraw accounts and carry excessive

credit balances (Aber et al., 2016; Agnew, 2018; Yakoboski & Lusardi, 2018).

Yet, Aber et al. (2016) in their study of 511 students and parents using a digital

cash-transfer program also noted that students actually reduced their spending on

discretionary items while parents increased their spending. Perhaps that finding is a

product of the parents purchasing those discretionary items for their student-child;

however, it may also reflect children embracing ownership of those funds and adjusting

their spending habits accordingly. Regardless, improved access to financial services via

fintech requires higher digital-financial-literacy and overall financial-literacy levels to

support productive behaviors and decisions on these platforms (Brown & Taylor, 2016;

Grohmann & Menkhoff, 2017; Morgan et al., 2019; Yakoboski & Lusardi, 2018).

The case for financial technology, not only as a complement to literacy programs

but as a mechanism to maximize the scale and effect of education efforts, was extolled by

Agnew (2018), Arnold and Rhyne (2016), and Bamforth et al. (2018). In fact, Bamforth

et al. and Kim et al. (2017) not only encouraged the use of fintech to foster prudent

money-management behaviors between the parent(s) and child(ren), they noted that

fintech may be the vehicle through which children “resocialize” their parents as they

learn together about personal finance concepts and the functionality of the digital

platform. This concept of reciprocal socialization, learning, and leveraging fintech to

break the stigma of openly discussing money, informed the content and focus of my

interviews with parent-subscribers to the FMVB platform.

Fintech in Financial Education

Lusardi et al. (2017) studied the effect that online-delivered education programs

has on self-efficacy, financial literacy, and decision making through a sample of 892

participants in the American Life Panel. The results spoke to the ability of web and

mobile-based tools to bring educational materials to users quickly and efficiently.

Although videos appeared to be most effective at improving financial literacy scores and

confidence levels, the study did not assess the viewers ability to transfer and apply this

enhanced conceptual knowledge, to situate the cognition within the context of actual

financial decisions (Lusardi et al., 2017). Warder et al. (2018), as part of his team’s

development and implementation of a computer-based application to teach financial

decision-making, noted the potential for computer-aided instruction to support and scale

literacy.

In a qualitative explorative study, Lee (2019) asked 20 Texas-based bank and

credit union leaders, who had experience delivering financial education, what their

perceptions were of using online education technology to foster financial literacy. Most

interviewees noted that their websites included financial calculators and links to external

government and commercial resources that students and consumers could access. They

also alluded to gamification and edutainment as ways to engage learners and supplement

in-person financial education. Yet, these sensory-stimulating, one-directional, digital

delivery methods do place the onus on the learner—first to access the tools and then to

interpret and apply game-based results and general web-based information to their own

financial circumstances. One financial leader, however, did emphasize that personal

finance education needs to be concrete, not gamified, with real-life financial practice

supported by parents and technology (Lee, 2019).

The above examples that focus on the use of technology to deliver content are not

representative of the emerging application of fintech through which financial transactions

and experiential learning can be supported. There is a common call among researchers,

including Yakoboski and Lusardi (2018) for baseline and longitudinal studies tracking

fintech use and literacy levels. Bolognesi, Hasler, and Lusardi (2020) contend that the

design of financial education programs needs to account for the increased use of fintech

tools among financially illiterate Millennials and their Gen Z successors. Moreno-Herrero

et al. (2018) also noted that it would be interesting to further study how fintech can

provide the vehicle for “conscious creation of opportunities that allow young people to

participate in financial practices” (p. 337).

As discussed in the 2017 EY FinTech Adoption Index, fintech companies have

excelled at capitalizing on the tech-literate but financially illiterate and underserved

populations. Fintech firms are also emerging specifically to target children, under the

auspices of starting them on the path to financial acumen and regular fintech use with

mobile tools for savings, investments, and payments” (EY FinTech Adoption Index,

2017). Palakvangsa-Na-Ayudhya et al. (2017) in their case study of recently-launched,

family-centered fintech applications commented that most applications fail to focus on

interactions between the parent and child. Also noteworthy, Carlin, Olafsson, and Pagel

(2017), who analyzed the consumer-credit behavior of more than 13,000 active users of

an online banking platform, discussed that the expansion of social learning and electronic

access to information reinforces the relevance and importance of future research in the

area of fintech and financial literacy. Although fintech is poised to encompass all the

components of a comprehensive and relevant financial education, including fostering

family socialization and positive money-management strategies using leading-edge

digital tools and products, its potential and impact have not been fully examined.

Leading researchers may dispute the effectiveness of traditional financial

education in the media; however, they do share a common area of agreement with

policymakers, which centers on the need to revisit the role of family and personal

experience in supporting financial knowledge and learning (Farinella et al., 2017; Kaiser

& Menkhoff, 2017; Tang & Peter, 2015; Xiao & Porto, 2017). The complexity of the

evolving financial services market and the recognition that social influences and

technology can add or subtract from financial literacy levels signals the need for a

recursive and holistic approach to financial education. This comprehensive model

includes quality formal education across grade levels, involves family members and

social service agencies, and promotes the use of technology to support prudent

moneymanagement behaviors (Agnew, 2018; Arnold & Rhyne, 2016; Bamforth et al.,

2018; Gudmunson et al., 2016; Kaiser & Menkhoff, 2017).

LeBaron, Rosa-Holyoak, et al. (2018) promoted systemic parental involvement to

inform and reinforce school-based personal finance content that includes authentic

practice opportunities and shifts financial decision-making responsibility to the student.

Moreno-Herrero et al. (2018) alongside Sundarasen et al. (2016), and Tang and Peter

(2015) collectively acknowledged and advocated for parental guidance at early life

stages, formal financial education, and applied opportunities to use financial tools. Also

worth noting is the common call for additional studies that test the effect of parental

communication on child saving and spending behaviors, include broader social networks

and financial institutions as part of the financial-education process, and assess existing

and proposed delivery methods of financial education (Blumenthal & Shanks, 2019;

Brown & Taylor, 2016; Kagotho et al., 2017; LeBaron, Rosa-Holyoak, et al., 2018; Sinha

et al., 2018; Xiao & Porto, 2017).

Financial Confidence and Literacy

Financial education in isolation from the home environment and which fails to

embrace the evolving fintech landscape as an applied-learning sandbox cannot adequately

enhance financial attitudes, self-efficacy, and confidence, which are precursors to and

products of financial behaviors and actions. Studies suggest that implicit and explicit

financial socialization and formal financial education may have a more direct and

pronounced effect on financial attitudes, identity formation, and confidence, which

encourage financial action rather than on financial behaviors themselves (Bosch et al.,

2016; Shim et al., 2015; Xiao & Porto, 2017). A key finding in the analysis of family

communication patterns and literacy levels by Hanson and Olson (2018) affirmed the

contention that subjective knowledge, or one’s perceived financial literacy level, has a

stronger impact on behavior than objective knowledge transmitted through family

interactions. This relationship between self-reported confidence and financial literacy

levels was measured in the PISA 2018 financial literacy assessment (OECD, 2020).

Fifteen-year-olds who are confident using cashless payment systems and tracking account

balances online had statistically greater financial literacy levels, scoring 29 points higher

than those without access to these digital products (OECD, 2020).

Allgood and Walstad (2016) positioned financial confidence as a proxy for

perceived financial literacy, which serves as a potential determinant and measure of actual

behaviors. Although they noted the value of self-assessment in comparison to an

objective measure of what financial knowledge people do know and can apply, Allgood

and Walstad recounted the dangers of acting on overconfidence characterized by a high

perceived financial literacy level when the actual level is statistically lower. This

cautionary note was also identified by Bolognesi et al. (2020) in their analysis of the

financial behavior and literacy levels of millennials ages 18-37 who participated in the

2018 National Financial Capability Study. They found that 62% of the study participants

rated their financial knowledge as high or very high, yet only 19% of these respondents

could correctly answer three questions about the time value of money, inflation, and risk

(Bolognesi et al., 2020.) Clearly, confidence may not in all instances account for

competence.

Yakoboski and Lusardi (2018) spotlighted the disconnect between self-reported

confidence levels and objective measures of financial literacy among millennial

smartphone users who used fintech for transaction and information purposes. When

technology-enabled overconfidence is acted upon, it leads to a pattern of irresponsible

financial behavior, which is one of the leading causes of debt among emerging adults and

other vulnerable groups (Amagir et al., 2018). Conversely, a child’s lack of financial

confidence could be attributed to limited parental presence in the household, which

negatively affects family-based financial education and money-management opportunities

(LeBaron, Rosa-Holyoak, et al., 2018). Thankfully, children’s expectations for themselves

and their self-confidence may change based on their education grade level and exposure

to accurate financial information (Bannier & Schwarz, 2018; Blumenthal & Shanks,

2019). Perhaps, individuals who are financially assimilated through multiple touch

points—e.g., school, parents, digital media—begin to realize just how little they know as

a result of additional education and financial experiences.

Summary and Conclusions

Financial literacy is a multi-faceted construct that encompasses conceptual

knowledge, family and expanded social influences, access to and experience with

financial products via technology, confidence levels, and behavior patterns. In the studies

referenced in this literature review, efforts to measure literacy levels and compare results

were confounded by the inconsistency across and within operating and research

definitions of the term. Moreover, much of the existing research centered on established

indices, which were designed as meta-assessments to reflect aggregate levels of financial

literacy. However, many of the quantitative research studies related to financial literacy

isolated line-item responses within these existing indices. They drew correlations between

categories of answers that may not accurately represent the factors associated with

financial literacy that the researchers intended to analyze.

Qualitative efforts also had their challenges. Attempts to capture the longstanding

effect of family financial socialization during the impressionable childhood years

typically occurred a decade or more later as a retrospective account from emergingadults

and their family members. Although these impressions were likely shaping present-day

behaviors, they did not reflect the real-time nature and purpose of those interactions and

their perceived effect on financial literacy. In addition, technology’s legacy in this turbid

landscape is still evolving as fintech further refines financial socialization, streamlines

access to financial products, and supports both productive and damaging cashless

financial transactions and behaviors.

Support for Study and Social Implications

The purpose of this study, to explore parents’ experience with and perceptions of

the use of fintech tools to support family financial socialization, was consistent with the

following recurring recommendations that emanated from the studies referenced in this

literature review:

• Capture a more expansive set of financial literacy inputs and influences,

including social agents and technology, with the goal of determining effect

level and informing financial education interventions.

• Conduct qualitative studies that collect real-time versus retrospective accounts

of the nature and content of family financial socialization.

• Include alternative perspectives beyond self-reporting of financial

socialization activities and literacy levels.

These gaps were also articulated in a post-study reflective analysis conducted by

Marks, Rosa, LeBaron, and Hill (2019). They mentioned the substantial body of research

that references parents’ pivotal role in their child’s financial socialization and capability,

including the work of Serido and Deenanath (2016), yet acknowledged that there is little

research-based discussion on what and how parents should teach their students about

finances (Marks et al., 2019). Serido (personal communication, January 23, 2020)

suggests that there is a distinction between shoulds versus shows that needs to be further

explored. What are the specific financial behaviors and decision-making strategies

parents should model that may be supported through fintech, versus what are they

actually showing and inculcating through their actions (J. Serido, personal

communication, January 23, 2020)?

This study did not position fintech as an intervention through which its effect on

financial literacy can be measured. It was designed, however, to address recurring gaps

and recommendations in the literature by providing a lens into the parents’ intentions

behind introducing a mobile payment and budgeting system to their child(ren); the nature

of the conversations with their child(ren) surrounding money that were prompted and/or

facilitated by the FMVB fintech tool; and insight on perceived changes in financial

confidence, self-efficacy, and literacy levels that the parents attributed to its use.

The effects of financial illiteracy on a micro- and macro- level cannot be ignored.

Burgeoning credit card and student loan debt shackles emerging and young adults.

Uninformed and misinformed financial decisions undermine their participation in and

contributions to social and economic growth. The findings from this study are not the

panacea for these global challenges. But perhaps, they will serve as the catalyst that

illustrates how scaling fintech to support family financial socialization in the formative

adolescent years can alter the financial identity, literacy, and behaviors of the next

generation.

Chapter 3: Research Method

Introduction

In this basic qualitative study I explored parents’ experience with and perceptions

of the use of a fintech tool to support family financial socialization and the associated

financial literacy levels of the parents and child(ren). In this chapter, I delve into the

rationale for a qualitative research design and the associated basic qualitative

methodology that I employed in this study. I also discuss my role as researcher and the

position I assumed within the study itself and associated considerations. In addition, I

describe the methodology, the study participants and selection process, and the data

collection and analysis method I used. I conclude by examining factors that support the

trustworthiness of this study.

Research Design and Rationale

The following central questions shaped the focus of my study:

RQ1: What are parents’ experiences with the use of a fintech tool to interact with

their child(ren) about financial concepts and decisions?

RQ2: What are parents’ perceptions of how the use of a fintech tool supports

conversation and transaction-based financial socialization activities between a parent and

child?

RQ3: What differences in financial literacy levels do parents perceive based on

their tandem use of a financial technology application with their child(ren)?

The central phenomena of this qualitative study were parents’ perceptions,

specifically as they related to their experience using a fintech tool to interact with their

child(ren) about financial concepts and decisions in support of financial literacy levels.

Accordingly, I employed qualitative research since its design and associated approaches

provide a descriptive frame and contextualized meaning to interactions among individuals

and their environment. In the instance of the current study, these interactions occurred

between the parent and child(ren) with and through the use of technology, specifically the

FMVB fintech tool.

One key distinguishing factor among the various approaches to qualitative

research is the associated foundational theory. For example, a basic qualitative approach

seeks to describe and understand a phenomenon, whereas an approach rooted in realism

strives to “move beyond description to explanation” (Patton, 2015, p. 112). Also, the data

collection methods, which are informed by the associated theory, vary by the approach.

For example, observation and retrospective interviews are the preferred data sources for

phenomenology and heuristic inquiry, while the interplay among focus groups members,

supports the synergistic relationship among phenomena found in a systems theory

approach (Howard & Hirani, 2013; Pallan, Parry, Cheng, & Adab, 2013). Moreover, the

study participants’ position relative to the time and place of the phenomenon being

studied (i.e., present-day engagement in the activity versus reflective perspective) informs

the approach, the research questions, and the data collection and analysis methods.

The use of a qualitative methodology is further supported by Caelli, Ray, and Mill

(2016), and Basias and Pollalis (2018). They emphasized that basic or generic qualitative

research blends established theory and epistemology with emerging fields of study.

(Basias & Pollalis, 2018; Caelli et al., 2016). For this study, the recognized theories of

family financial socialization and situated cognition, which are rooted in a constructivist

epistemology, served as the framework for the iterative design, implementation, and

analysis phases associated with the study-participants’ use of an emerging financial

technology. Further, Basias and Pollalis purported that a basic qualitative approach is

suitable to meeting the objectives of a study related to technology particularly where there

is “interaction of key factors,” which in this study included parent-child financial

interactions and reciprocal differences in literacy levels that may be facilitated through

the FMVB fintech tool (p. 98).

Given the existing theoretical foundation of this study (i.e., family financial

socialization and situated cognition) and the context-specific focus of the research

questions (i.e., perceptions related to the use of fintech tool), a basic qualitative approach

was the preferred and implemented method of inquiry for this study. As emphasized by

Percy, Kostere, and Kostere (2015), basic qualitative inquiry focuses on the outward or

contextual application of perceptions, reflections, and opinions. In contrast,

phenomenological inquiry focuses on the study participants’ isolated act of experiencing

feelings and beliefs, not on the context or outward manifestation of those cognitive and

emotional processes (Percy et al., 2015). Accordingly, the latter approach would not been

appropriate for the present study.

Also, a multicase study methodology and method would not have been applicable

to this research study. A multiple case study would have necessitated that the study cases

or units be bounded using criteria or a common context beyond that of being a subscriber

to the FMVB platform (see Miles, 2015). Since the commonality for this study is based

on the collective use of a fintech tool, there was no apparent subunit that would have lent

itself to within and across-case analysis (Miles, 2015). Moreover, the comparative

analysis associated with a multi-case study approach uses established variables, which are

neither present nor relevant to the research questions, to understand and explain predicted

versus resultant similarities between cases (Baxter & Jack, 2005).

Unlike quantitative studies, which typically use some form of questionnaire with

answers that can be quantified to test or verify what Ravitch and Carl (2015) would call a

singular “objective or immutable truth” (p. 9), a qualitative study acknowledges that the

phenomena being studied occurs in a broader context. Since I did not intend to confirm an

existing theory or prove/disprove a hypothesis, a quantitative approach did not support

the purpose of this study. Rather, this study explored perceptions and experiences of

parents within the dynamic fintech and family context in which money-based interactions

occur. Given that there is an existing body of “pre-knowledge/pre-understandings” (Percy

et al., 2015, p. 78) relative to family financial socialization, which I expanded upon in the

applied context of financial technology, a basic qualitative inquiry was the appropriate

methodological approach (see Percy et al., 2015).

Role of the Researcher

In keeping with the tenets of a basic qualitative study, I personally collected,

analyzed, and interpreted the data compiled from the interviews. This role, as

characterized by Patton (2015), required me to assume an objective but empathetic and

reflective stance in relation to the study participants and throughout the transformation of

data into meaningful information. Since I did not have any personal or professional

connections to any study members, I was able to maintain objectivity throughout the

process.

Bias, however, is almost inevitable in this type of people-centric research study

and needs to be acknowledged and accepted (Burkholder, Cox, & Crawford, 2016).

Accordingly, I kept a reflective journal that identified any predispositions I had towards

key elements of the conceptual framework. To further mitigate bias, I recorded the

rationale behind key decisions throughout the design, implementation, interpretation, and

reporting phases. Also, as suggested by Yin (2009), I maintained a chain of evidence that

captured the progression from the formulation and refinement of the research questions

through to the reporting phase.

Methodology

As stressed by Caelli et al. (2016), a qualitative researcher must be able to clearly

distinguish and articulate the relationship between a qualitative research methodology, the

theories that inform the research approach, and the methods themselves, which include

data collection and analyses techniques. Accordingly, the considerations and rationale

associated with how I approached, implemented, and interpreted this study were informed

by the conceptual framework and tenets inherent in the foundational theories.

Participant Selection

The participants in my study were active parent/guardian-users of the FMVB

fintech mobile banking, budgeting, and payment platform. The criteria for inclusion in the

study were all active parent users of the fintech tool. The criteria for exclusion were those

who may have purchased a subscription but were not actively engaged in regular

transactions at the time of the study. This latter subset of subscribers was self-excluded

from the potential pool of participants since they did not respond to recruitment

communication distributed through channels populated with active subscribers.

As noted by Patton (2015), qualitative sampling needs to be flexible and

pragmatic. The objective is to create a contextually rich analysis of the given

phenomenon, which typically warrants depth with a minimal number of study participants

versus breadth with a larger sample (Patton, 2015). Ideally, as noted by Patton (2015), the

sample size will be adjusted during the fieldwork to achieve a reasonable level of

saturation. As anticipated, I reached a proxy of saturation as evidenced by redundant

themes with 16 participants (see Caelli et al., 2016).

In terms of sequence, once I secured institution review board (IRB) approval

(0317-20-0578234), I sent the founder-developer of FMVB a recruitment announcement

to disseminate in a biweekly newsletter and monthly blog post. I also received

authorization to post the recruitment announcement on the site’s closed subscriber

Facebook Group. Interested participants were directed to a linked form where they

reviewed the informed consent documentation that detailed the purpose of the study, the

interview procedures, the voluntary nature of the study, the risks and benefits, and privacy

considerations.

Individuals who formally consented to be part of the interview, as evidenced by

selecting the “I consent” form on the informed consent document, were then directed to a

digital appointment scheduling dashboard (i.e., Calendly) that limited the number of

interviews to 18, and notified subsequent visitors that they may be contacted in the near

future. Setting the threshold at 18, which was eight above my proposed number of 10,

allowed me to account for potential cancellations and withdrawals within the interviewee

pool. The final number of interviewees was 16, and I interviewed each subject once. Each

scheduled interviewee received an electronic link to the Zoom videoconference room and

digital reminders through the Calendly application.

Instrumentation

To create my initial set of interview questions and probes, which are included in

Appendix A, I reviewed Rubin and Rubin’s (2012) components of a responsive interview

and incorporated guidance from DiCicco-Bloom and Crabtree (2006) for creating

semistructured, in-depth interviews that allow the interviewer and interviewee to cocreate

meaning. This interview technique was consistent with the conceptual framework and

research questions, which focused on experiences and perceptions, factors that Evans and

Lewis (2018) characterized as the realities and meanings that study participants connect

to their assumptions or ideas within a given context. The context for this study was the

authentic learning and family-based financial experiences embedded in the FMVB fintech

tool that were explored in relation to financial literacy levels through the interview

process.

To ensure I honored and built on the evolving body of research on how fintech

may facilitate family financial socialization, support situated financial cognition, and

further financial literacy, I secured permission for and drew upon the interview guide

from the longitudinal research of Serido related to financial parenting and financial

selfreliance of young consumers (J. Serido, personal communication, January 23, 2020). I

also reviewed the work of Lusardi and Hasler at the Global Financial Literacy Excellence

Center (A. Hasler, personal communication, January 22, 2020). Specifically, I reviewed

the code tables and survey items related to parental support and encouragement, and

technology use in financial education. My objective was to identify any facets of these

financial literacy levers that I had not accounted for in my interview questions.

In addition, to promote alignment, content validity, and credibility, I made certain

that the focus of each question emanated from the conceptual framework. This step

ensured I addressed issues of “congruence or commensurability” that may occur when a

researcher borrows components of previous resource methods from studies that had a

different theoretical foundation (see Caelli et al., 2016, p. 9). Also, without compromising

their denotative and connotative meaning, I substituted keywords found in the conceptual

framework and research questions with layperson synonyms in the interview questions.

Procedures for Recruitment, Participation, and Data Collection

For this study I conducted one interview with 16 subjects over the course of 6

consecutive days to achieve saturation. Interviewees scheduled a convenient, 40-minute

videoconference time through the digital platform Calendly. Each videoconference was

conducted on and the audio recorded through the Zoom videoconferencing platform with

expressed written and oral consent from the study participants. Given that the subscribers

to FMVB are dispersed throughout the U.S., in-person interviews were not an option.

Since the study participants are using a mobile and web-based banking and payment

application, they were, as expected, comfortable using a videoconference platform.

Videoconferencing, as noted by Irani (2019), affords study participants the

comfort of being interviewed in a familiar setting, and allows the interviewer to read and

respond to verbal and non-verbal cues. Granted, I, as the video-conference host, did not

have the same visual range of the interviewee’s body language as I would have had in

person; nevertheless, it was a superior alternative to a phone-only modality or an

asynchronous email exchange.

At the conclusion of the interviews, I thanked the participants for their time and

input. I advised the interviewees that they may contact me with additional questions and

to anticipate a copy of the transcript for their review. Although this form of

memberchecking affords a study participant the opportunity to review collected and/or

analyzed data, it may be, according to Caelli et al. (2016), “incommensurable with a

constructivist epistemology” (p. 7). My reasoning for allowing member-checking aligned,

in part, with Dervin’s (1997) position on elevating trustworthiness. I did, however, use

memberchecking judiciously and limited it to transcript review. My goal was to ensure

the accuracy of a transcript and afford the research participant the opportunity to provide

additional clarification and context, which several did. The intent was to increase

trustworthiness in the data collection process but not abdicate or diminish my role as a

researcher (Dervin, 1997).

Data Analysis Plan

I used theoretical analysis, a form of thematic analysis, to examine the data

collected in this study. This approach honored the theoretical and epistemological

underpinnings of the research questions and afforded me the opportunity to analyze the

data through the lens of a priori codes while acknowledging that new domains may

surface. First, I created a set of terms and preliminary categories that were grounded in

the study’s conceptual framework, research questions, and codes from related prior

research. I then proceeded to label and group the interview content (Patton, 2015). From

there, I employed an inductive approach as I identified recurring patterns based on

similarities, differences, frequency, sequence, or relationship among the categories

(Saldaña, 2016, p.7). For the final iteration, I overlaid a deductive approach using the

themes that emerged as part of the literature review to “affirm the appropriateness” of my

inductive analysis (Patton, 2015, p. 542).

Coding the interview data, even with the support of qualitative data analysis

software, was an iterative, time-intensive process (Caelli et al., 2016). It required me to

summarize transcripts and ascribe labels that captured the meaning and intent of the study

participant, in my case the interviewee, in relationship to the phenomenon being study.

These resultant labels or categories were then compared and combined into broader

categories. From there, I generalized these categories to reflect enduring themes that

illustrate how the findings apply beyond the construct of the current study (Rubin &

Rubin, 2012).

I began my data analysis by assigning initial codes based on concepts that are

associated with my theoretical framework and which appear in the other research studies

rooted in family financial socialization and/or situated cognition. In effect, I created what

Saldaña (2016) would call a provisional list of code using labels such as confident, social,

and intentional/unintentional to describe financial-socialization and literacy-related

factors that parents perceived were facilitated by or were a result of using the FMVB

fintech platform.

My second round of coding took into consideration the epistemological

orientation of my research questions, which sought to understand perceptions related to

financial behaviors and knowledge. Using the NVivo software, I employed pattern coding

to consolidate initial codes into more meaningful and theme-related concepts (Saldaña,

2016). My priori coding, as anticipated, affected the relevance and quality of my

subsequent cycles of work. Each successive phase required me to go beyond the mere

reporting of disparate coding schemes and apply meaning and relevance to each of

associated categories and candidate themes by clearly articulating how it supported and

extended components of the conceptual framework and research questions (Braun &

Clarke, 2006; Caelli et al., 2016; Evans & Lewis, 2018). Refer to Appendix B and Figure

4 for additional detail.

Specifically, Evans and Lewis (2018) citing the work of Braun and Clarke (2006)

identified two levels of thematic analysis that I employed. The first, which is semantic,

occurred simultaneous and subsequent to the conceptual-framework-based, a priori

coding. Here, I mapped explicit statements from interviews to existing coding schemes or

generated new ones. The second-stage, latent analysis honored the constructivist

principles associated with the study’s purpose and research questions, and required me to

looked at an interviewee’s statements in relation to the broader field of discourse (Braun

& Clarke, 2006). This phase necessitated that I acknowledge my assumptions and the lens

through which I was interpreting the content (Evans & Lewis, 2018). When employed in

a systematic and iterative manner, these two levels of analysis are designed to construct

meaning to and convey relevance about the data. Moreover, any disconfirming cases that

emerged (i.e., perceptions from the study participants that did not align with existing or

emerging themes) were reported and serve to support the trustworthiness of this study

(Patton, 2015).

Issues of Trustworthiness

The trustworthiness of a qualitative study is a product of four dimensions:

credibility, transferability, dependability, conformity, and overall quality (Shenton, 2004).

The credibility of this research study, which was designed to elicit parents’ perceptions of

and experiences with a fintech tool to interact with their child(ren) about financial

concepts and decisions, was supported with accurate, descriptive excerpts from the

interviews. I wove together a coherent, contextualized, and comprehensive narrative of

the study participants’ individual and collective experiences and perceptions. I also

employed member-checking to ensure the accuracy of my transcription and to afford

study participants the opportunity to clarify and/or provide additional context to their

interview responses.

The dependability and confirmability of the categories and themes I identified

were enhanced through the use of existing codes and themes from credible research

studies, alongside the iterative review process I undertook with each successive phase of

data analysis and interpretation. To promote the dependability of this study, I clearly

described in my reflective journal and associated documentation the rationale for the

research design, how it was implemented in terms of actual practice, and the effectiveness

of the data collection and interpretation protocols (Shenton, 2004).

Notably, Patton (2015) questions the existence of true objectivity, a hallmark of

quantitative studies, since human skill and perception influence the objectivity, or in the

case of qualitative studies the confirmability, of both bodies of research. To that end,

Shenton (2004) emphasizes the need for an “audit trail” that maps out steps in the data

collection, interpretation, and reporting processes. Alongside these key process and

decision stages, Shenton encourages a more theoretical track that captures the ontological

underpinnings of the study and the predispositions of the researcher. Therefore, I created

a graphical representation of a decision-and-event tree as part of my reflective journal.

As noted earlier, relevant themes not only bring meaning to the information

collected, they support the transferability of the results beyond the construct of the data

set (Rubin & Rubin, 2012). To further promote transferability, I focused on developing

rich, deep descriptions of the study participants’ perceptions and experiences. Ideally, the

narrative contained in this study might inform the use of technology to promote and

support family engagement in relation to student growth across multiple literacy metrics,

not just financial.

The responsive approach that I took to each phase of the data collection process

helped me to create thick descriptions. Although not necessary in the present study, this

technique would have compensated for potentially low thematic saturation and any limits

on contextual and cultural appreciation that are inherent in a remote interview process. As

Ravitch and Carl (2015) recommended, I clearly explained to prospective study

participants and actual interviewees the objective of the study and how the interview

would be used as a medium to collect data. I explained how the data will be recorded and

used, emphasizing how anonymity is maintained. I also afforded interviewees an

opportunity to ask questions about the study and protocols before and after our dialogue.

Ethical Procedures

The human-centric nature of qualitative research is fraught with ethical

considerations, what Ravitch and Carl (2015) citing Sharon refer to as “micro-design

choices” (p. 379). Ravitch and Carl encourage researchers to be conservative, to model

ethical, respectful, and transparent behavior by seeking informed consent in those

instances where it is unclear whether participants have an expectation of privacy. Beyond

strict adherence to Walden University’s IRB requirements, a conservative orientation

guided my actions throughout this research project.

Ethical procedures and protocols were followed throughout the recruiting, data

collection, and debriefing process. I did not begin the study, nor did I begin to recruit

potential participants until I received IRB approved. At that point, I began to actively

solicit study participants. My communication explained the purpose of the study, format,

risks, and benefits related to voluntary participation, alongside the steps taken to ensure

confidentiality and to protect personally-identifiable information. I afforded each

prospective participant the opportunity to ask questions before executing the informed

consent agreement.

I also advised study participants that they may elect to withdraw at any time in the

process and that any data collected prior to their withdrawal will be kept confidential and

excluded from the final report. I clearly delineated steps that would be taken, in

accordance with Walden IRB, to maintain the participants’ privacy and to safeguard any

data that was collected. Digital transcriptions and notes related to the interviews are

secured in a password-protected folder. Related written documents are filed in a locked

cabinet and will remain there for five years, at which time I will shred them.

Participants were advised and reminded that their names and any potential

personally-identifiable information are masked in the written study, that participation was

voluntary, and that they may have withdrawn at any time. I provided study participants

with my contact information and that of the Research Participant Advocate at Walden

University.

Summary

Chapter 3 provided a detailed description of the research design and supporting

rationale, my role as the researcher, the research methodology, and the data collection and

analysis plan that I implemented. I also addressed considerations related to

trustworthiness and ethics. This basic qualitative study used semistructured interviews

that were transcribed using thematic coding. The goal was to create a rich, deep narrative

that reflects the parents’ perceptions regarding the use of a fintech tool to promote and

support family financial socialization and financial literacy levels. The results of this

study may help connect the disparate research on financial technology, family financial

socialization, and financial literacy. As noted earlier, the findings may inform future

policy and programmatic initiatives related to purposeful parental involvement in

financial education and the use of financial technology to promote financial socialization

and literacy levels in the home and classroom environments. Chapter 4 presents the

results of the study through the lens of existing scholarship and the conceptual

framework, which is grounded in the theories of family financial socialization and

situated cognition (Brown et al., 1989; Gudmunson & Danes, 2011).

Chapter 4: Results

Introduction

The purpose of this basic qualitative study was to explore parents’ experience with

and perceptions of the use of a fintech tool to support family financial socialization and

the associated financial literacy levels of parents and children. The following research

questions guided my data collection, analysis, and interpretation:

RQ1: What are parents’ experiences with the use of a fintech tool to interact with

their child(ren) about financial concepts and decisions?

RQ2: What are parents’ perceptions of how the use of a fintech tool supports

conversation and transaction-based financial socialization activities between a parent and

child?

RQ3: What differences in financial literacy levels do parents perceive based on

their tandem use of a financial technology application with their child(ren)?

Organization

In this chapter, I will present the results of my dissertation study. I will describe

the setting for the study, provide relevant descriptive statistics associated with the study

participants, explain the data collection and analysis processes, and discuss evidence of

trustworthiness. I will then present the results of my research, organizing the data

according to the themes I distilled, and conclude this chapter with a summary.

Setting

The site for this research study was FMVB, which markets itself as an educational

prepaid card. As noted earlier, the cards are used in tandem with the FMVB mobile and

web-based virtual family banking software where parent(s) and child(ren) can establish

budgets, request and send money, split payments, set and reward savings goals with

interest, and view balances and activity. This integrated mobile banking, budgeting, and

payment application that parents comanage with their child(ren) is designed to develop

financial skills through hands-on experience.

All study participants were active adult-subscribers to FMVB. Each of the 16

participants engaged in an in-depth interview that lasted a minimum of 40 minutes. It

should be noted that approximately two weeks prior to the start of these interviews, the

United States had declared a national emergency related to the Coronavirus pandemic.

That announcement, however, did not temper participation in my study, which was

oversubscribed. Naturally, the interviewees noted concerns around the financial fragility

of the economy and the physical and financial wellbeing of their family moving forward.

Most commented on the timeliness and relevance of our conversation given the financial

uncertainty that many Americans would likely face depending on the duration and

severity of the crisis. The parent’s foreboding was recapitulated in the OECD’s May 2020

release of the 2018 PISA financial literacy results:

The Covid-19 pandemic has also made evident the uncertain and precarious

financial employment situations in which many people find themselves. Financial

literacy may improve citizens’ financial resiliency, thereby preparing them to

manage and weather such unexpected shocks. Many 15-year-olds face financial

decisions and are already consumers of financial services. They are likely to face

growing complexity and risks in the financial marketplace as they move into

adulthood (OECD, 2020, p.34).

Demographics

Participants were recruited through the FMVB subscriber Facebook page and a

listserve mailing sent by the study site’s CEO. At the time of the interviews, seven of the

16 participants had been using the platform for 3 or fewer months, and 13 had been using

it for 1 year or less. The longest subscriber had been using FMVB for 4 years. Of the 16

interviewees, 14 had two children currently on the platform. Two of the parents had four

children using FMVB. The average and median age of a child-subscriber was 13 and split

between gender with 14 females and 15 males. At the time of this study, none of the

children had taken a personal finance class or had explicit classroom-based instruction in

personal-finance-related topics. Figure 2 captures the descriptive data associated with the

participants in this study.

Figure 2. Descriptive data associated with study participants.

Data Collection

I interviewed a total of 16 adult-subscribers to FMVB and assigned each an

alphanumeric pseudonym P01–P16. Each interview lasted approximately 40 minutes and

was conducted over the course of six consecutive days. I recorded the audio portion of the

interview using Zoom. See Appendix A for a representative sample of the questions asked

during these semistructured interviews.

Although technical challenges occurred at times, unstable internet connections on

the Zoom video-conferencing platform, each interview yielded a complete and usable

audio recording. I transcribed each recording. During the process, I eliminated verbal

disfluencies and addressed most of the grammatical issues without compromising the

tone or content. I also excluded side conversations that included personally sensitive

information that was not germane to the study. I emailed each study participant a copy of

the edited transcript and requested they review it for accuracy, completeness, and

adequate context. I also asked them to share any additional examples or post interview

thoughts, which several did. My data collection process did not vary from the proposed

form and format, and I did not encounter any unusual circumstances as I collected the

data.

Data Analysis

I used a form of thematic analysis whereby I actively engaged with the written

interview transcripts, reading them several times to identify excerpts that appeared

consistent with components of my conceptual framework and annotating sections that

could form potential new codes (Braun & Clarke, 2006). Refer to Figure 3 for the a priori

codes and Appendix B for associated descriptors.

Figure 3. A priori codes adapted from research studies related to Gudmunson and Danes’

(2011) family financial socialization processes and Brown et al.’s (1989) theory of

situated cognition.

I uploaded the transcripts to NVivo, created nodes based on the preliminary a

priori codes, and systematically coded the interview data. I added new topical codes that

were rooted in segments of the transcripts and related to the study’s phenomenon, but

were not accounted for in the conceptual, a priori codes. To ensure I provided ample

context for the data interview segments that I coded, I included surrounding text. As

applicable, I also assigned multiple codes to excerpts with the intent of illustrating

potential relationships between codes of information during the advanced stages of my

analysis (see Braun & Clarke, 2006).

During the next phase of my analysis, I reviewed the descriptors associated with

each code with the objective of combining redundant codes and identifying

complementary and conflicting patterns across the codes. I then proceeded to group the

codes into categories that emanated from the conceptual framework and extant literature

while also capturing the relationship among the codes as expressed by the participants

(see Vaismoradi, Jones, Turunen, & Snelgrove, 2016). Equally important, I created what

Vaismoradi et al. (2016) have termed participant-perspective and setting codes, which

align with the perspective-taking focus of the research questions and account for FMVB’s

role as the research setting and financial socialization facilitator. As one parent-subscriber

(P9) expressed, in a sentiment echoed across most of the study participants, “FMVB is a

learning environment. We talk about it [finances] a lot more” The results of that category-

and code-building process and the associated number of references from the interviews

are reflected in Figure 4.

CODE

DESCRIPTION

REFS

CATEGORY: PERSONAL FINANCE EXPERIENCES AND LESSONS

Cash or Credit Alternative

Need for cashless payment option.

Decisions and Transparency

Conceptual and transactional understanding of the value of money including comparison

shopping and opportunity costs. Illustrates patterns of spending. Makes spending visual.

Lessons and Messages

Financial concepts, skills, and attitudes that parents attempt to share through direct

communication, teaching, and daily money-centered activities.

Intentional or Unintentional

Explicit modeling and teaching versus tacit scripts, modeling, and behaviors. May be

productive and/or counter-productive.

Age-appropriate

Money-centered conversations, transactions, and decisions that parents perceive their

child is ready to engage in and understand. May include use of fintech and cashless

financial products.

Authentic

Learning opportunities, including everyday experiences that may be facilitated by

technology and may include consequences.

Manual Systems

Non-technology systems parents had or would need to put in place in lieu of fintech.

Reciprocal

Interpersonal and intergenerational exchanges and learning that occurs through

moneycentered conversations, shared experiences/mutual learning, and modeling.

Structured vs Adhoc

Systems and mechanisms for promoting contributions toward family responsibilities and

ensuring commensurate and timely compensation.

CATEGORY: FINANCIAL SOCIALIZATION COMPONENTS

Conflict and Objectivity

Instances of how fintech has made interactions centered on family responsibilities (i.e.

chores) and spending patterns less contentious and emotion laden given the data on

spending and saving patterns.

Conversations

Examples of mutually-initiated, money-centered conversations. Identifies instances where

fintech has deepened the level of sophistication of the conversations.

Different Abilities and Attitudes

Use of fintech to support differently-abled family members and those with different

attitudes and orientations regarding money management and goals.

Socialization Agents &

Influencers

Expanded socialization agents as influencers—e.g., social media and peers.

Longstanding influence of parental messages.

Norms: Generational,

Social, Cultural

Generational, societal, and cultural unwritten rules surrounding the topic of money

Adult-subscriber’s

Childhood Socialization

Recount of how the parents / adult-subscribers learned about personal finance.

Value(s)

Financial orientations that the parents’ want to instill in their children. Includes the

monetary-based concept of “value,” and underlying tenets of family values.

Orientation and Attitude

Same financial socialization experiences but different attitudes and behaviors.

CATEGORY: FINANCIAL LITERACY INDICATORS AND OBJECTIVES

Accountability and Autonomy

Instances where fintech has supported mutual responsibility for money-based decisions and

transactions while promoting a sense of independence and ownership.

Financially literate

Perceived financial-literacy level that parents ascribe to their child(ren) in comparison with

child(ren)’s peers.

Capable

Subjective assessment that combines personal finance conceptual knowledge, productive

financial behavior, and self-efficacy that may be attributed to the use of fintech.

Confident

Parents’ subjective measure of their child(ren)’s comfort level to make financial decisions and

transactions based on personal finance knowledge and skill.

Goal oriented

Future financial independence; values and aspirations parents have for children.

Savings

Systematically setting aside money for a long-term purchase.

Figure 4. Resultant categories, codes, descriptors, and number of references.

From the categories, I then proceeded to develop what Braun and Clarke (2006)

characterized as a “set of candidate themes” that are rooted in the data, honor the

conceptual framework, speak separately to the study’s phenomenon of interest, and

weave a concise story that speaks to the relevance and implications of a theme in relation

to the study’s purpose (p. 20). Figure 5 reflects the progression and refinement from

categories to candidate themes.

CODE

REFS

THEME

RESEARCH QUESTION

CATEGORY: Personal Finance Experiences and Lessons

Cash or Credit Alternative

Parents use fintech to

facilitate timeless

financial lessons

RQ1: What are parents’

experiences with the use of

a fintech tool to interact

with their child(ren) about

financial concepts and

decisions?

Decisions and Transparency

Lessons and Messages

Intentional or Unintentional

Age-appropriate

Authentic

Manual Systems

Reciprocal

Structured vs Adhoc

CATEGORY: Financial Socialization Components

Conflict and Objectivity

Perceived shifts in family

financial interactions

that parents attribute to

FMVB

RQ2: What are parents’

perceptions of how the use

of a fintech tool supports

conversation and

transaction-based financial

socialization activities

between a parent and

child?

Conversations

Different Abilities and Attitudes

Socialization Agents & Influencers

Norms: Generational, Social, Cultural

Adult-subscriber’s Childhood Socialization

Value(s)

Orientation and Attitude

CATEGORY: Financial Literacy Indicators and Objectives

Accountability and Autonomy

Parents’ proxy measures

of financial literacy

RQ3: What differences in

financial literacy levels do

Financially literate

Capable

parents perceive based on

their tandem use of a

financial technology

application with their

child(ren)?

Confident

Goal oriented

Savings

Figure 5. Categories, themes, and associated research questions.

One discrepant case did emerge within the participant group and expanded the

description of a typical and now seemingly restrictive definition of the characteristics of

an FMVB subscriber. P16, a long-term subscriber, was not using the fintech platform in

tandem with children. P16 had self-subscribed with a spouse to curb gambling behaviors:

[The spouse] pretty much acted as the quote parent, and I acted with a card as the child. I

will tell you that it solved the problem. I had access to funds…and [my spouse] got an

alert every time I was using it…It gave [my spouse] some observation of what I was

using it for, and it put a lot of accountability on me, which was the idea.

This use of the platform to support the financial component of addiction recovery,

coupled with expanded application of the platform to support elder-care and individuals

with developmental, behavioral, and social challenges expanded the “story line that gives

a holistic view on the study phenomenon,” which centers on the use of fintech as a

socialization and education tool (Vaismoradi et al., 2016, p. 107).

Evidence of Trustworthiness

I addressed credibility by crafting categories and resultant themes that honor the

extant literature while speaking to the singular and collective perceptions and experiences

of the study participants. I also employed member-checking to afford study participants

the opportunity to clarify and/or expand on their responses, which several participants

did. To support the transferability of the results, I included detailed, nuanced descriptions

of the study participants’ perceptions and experiences using FMVB that may inform the

personal finance education efforts of caregivers, educators, policy makers, and the

financial industry.

Likewise, I used multiple strategies to promote the dependability and

confirmability of my codes, categories, and themes. Initially, I undertook a deductive

process to identify interview excerpts that may support or refute codes derived from the

conceptual framework and associated literature. Next, I completed an exploratory review

of the data using a semantic lens to identify codes embedded in the participants’ words. In

the subsequent iterations, I evoked a more latent approach as I refined, merged, and

categorized codes that reflect a more contextual understanding of the participants

perceptions and experiences (Braun & Clarke, 2006). As I repeatedly cycled through the

data, I kept a reflective journal that serves as a working document and audit trail of my

approach to labeling, defining, and interpreting the data. My goal was to forge a balance

between immersion in and distancing from the data, staying true to the established

research while legitimizing the participants’ narrative and my related analysis and

interpretation (Vaismoradi et al., 2016).

Results

In this section, I will report study results organized by themes. This approach is

consistent with the objective of highlighting the relevance and transferability of the

findings beyond the scope this study.

Theme 1: Parents use fintech to facilitate timeless financial lessons

This theme, which supports RQ1: What are parents’ experiences with the use of a

fintech tool to interact with their child(ren) about financial concepts and decisions?,

encompasses how the study participants have positioned and used FMVB to support

conversations, modeling, and systems that form the basis of the finance-related

interactions among family members. See Figure 6 for additional detail.

On a transactional level, FMVB fulfilled a defined need for all the study

participants—a cash or credit alternative. P06 captured the general sentiment of the

FMVB subscribers that I interviewed when stating, “Cash isn’t practical anymore.” All the

participants cited that as adults they rarely carry cash. So, oftentimes they do not have the

cash on-hand to give to their child to go out with friends or as part of an allowance. P11

recounted another recurring challenge that the use of this fintech tool addressed. “It’s been

almost 180 degree turn since we changed [to FMVB] because they [the children] never

knew where they put their cash or how much they had. They would just fold it up, throw it

in a bag.” Also, participants with teenagers noted that FMVB solved the problem of not

wanting to hand over their debit or credit card or as P06 framed it “a wad of bills” when

their children travel for sports, school, or on a separate trip.

What started as a tool to fulfill the practical need for a non-cash alternative has

become for many participants a structure to promote a sense of shared responsibility

between the parent and child, while supporting the parents’ efforts to deepen their child’s

understanding of the concept of value. A recurring commentary was perhaps best

expressed by P03, “To be honest, I [subscribed to FMVB] as a way to given them money

they needed it. But it’s turned into more than that. I now think that I was really looking

for structure.” “This platform is something that I can manage from phone at 10 p.m. when

I’m thinking about it and can actually make it happen,” stated P10, “…and so it’s been a

real enabler for us.”

Structure brings value. The ability to set up a chore chart and assign a price to

each task was one feature to FMVB highlighted by most of the parent-participants. In

addition to promoting shared responsibility and accountability—on the child’s side to

complete the task and on the parent to issue prompt payment—the act of earning money

in exchange for work underscored the connotative meaning of value. The concept of

value, in terms of money and as a family ideal related to work ethic, was discussed

repeatedly by the parent-participants including P15 who commented that [FMVB]

“reinforces what we do here–earn your money and save it when you can.” P10 shared that

FMVB supplemented but did not supplant existing norms. “It’s our family philosophy

that you have responsibilities around the home and that is not something that we give a

monetary reward for…If you want to do more than what your regular responsibilities are,

we can talk about what that’s worth.” P14 recounted,

I think the one thing that I have liked about [FMVB] and the reason why we

started to use it in the first place was because of the chores. So, we are able to

have that whole value of money thing. You do something, you get something in

return, which I think has helped them understand value. It’s not just that money all

of a sudden shows up. Or, if you want something, it just shows up on the

doorstep. There’s a tit for tat. You do this, you get this, and then you can go get

this.

P08 discussed how he was not trying to “school [his child] morally and ethically

all at once,” but was hopeful that eventually those conversations alongside the use of

FMVB would translate into his child thinking more empirically about value in terms of

money and time. P15 commented that the lessons associated with FMVB are “just basic

responsibility. Having a debit card, keeping track of it, knowing how much money you

have on it. Just that basic.”

Context and consistency matter. The parent-subscribers shared ways in which

they try to educate their children about saving, spending, and borrowing. The format of

those explicit and implicit lessons included: conversations, active participation in daily

activities that involve the exchange of money, observations of parents negotiating the

price of large purchases, and lecturing. P05 indicated that conversations among family

members about funds can be “very real and raw particularly with what is happening right

now with the virus and people losing their jobs.” P03 recounted, “I went off my soapbox

about not buying more than you can afford…and there are a lot of examples around me of

people who are doing that. So, it’s like you can’t do that. You need to be careful. You

need to pay attention.” The effectiveness of these lectures came into question for several

of the participants including P11, “But it would be just us talking and questioning. What

are you buying? What do you need? Is there something you want to save up for?”

Most participants discussed how they supplemented those conversations by

engaging their child(ren) in age-appropriate activities that involve the exchange of

money. P12 conveyed, “So, we’ve tried to be intentional about making those learning

experiences out of things that come up in everyday life.” P06 also noted how

homeschooling lends itself to more real-life money experiences including the “errands

that everyone hates.”

I take him with me for that purpose, so that he can learn that life isn’t all just fun

things. Sometimes we have responsibilities. When you do these responsibilities,

there are questions you have to ask yourself. When we go to the store, we have

this much money. What are we going to spend it on? And how can we shop

around and get the best bang for our buck? It’s that kind of organic learning.

In addition to introducing financial concepts through daily activities, participants

also highlighted some of the non-technology-based systems they have used, with mixed

success, including: chore and goal charts, maintaining a mock check register to track cash

received and spent, and envelope and jar systems to allocate money for specific purposes.

As P14 relayed, which holds true for all the study participants, cash and check

transactions were the norm growing up. Now, “it will always be a credit card or it’s even

just with my phone.”

Upon reflection, P07, P09, P10, P12, P14 and additional participants quoted

below questioned what their conversations and inconsistent use of paper systems were

really showing their children. “I was not imparting all the things that I have learned to my

kids in a relevant manner because things have changed since I was younger,” P09 relayed.

“Although I like the idea of using an envelope system…it’s just not practical...We don’t

keep money like that.” Parents also lamented over their failed attempts to maintain an

allowance system, noting that they and the children weren’t consistent on following

through. “Everything was sporadic, P11 explained, “and it meant keeping cash around,

which neither of us [reference to children and parents] were good

at.”

Participants asserted that children cannot learn financial concepts and practices

abstractly and remotely by just listening and watching. P03 explained,

I would always try to tell them that’s expensive or you have to pay for that, but

it’s hard to have those kinds of conversations... So, I think [FMVB] gives them

the starter program…It makes the conversations a little more concrete.

P09 shared an example of how her two children were shopping with their newly-issued

FMVB prepaid debit cards and had to come get the adult parents because they did not

know how to use it. “It was just weird. They needed help with that, but they’ve seen us do

it a million times.” P13 underscored, “They need to know how to swipe a card, enter their

pin number, sign for it.” P06 took a more balanced approached to the digital versus paper

paradigm. She noted that although she does not carry cash anymore and relies heavily on

technology, she still thinks it is important to have children “learn about things the old

way.”

Digital makes it visible. The notion that a digital platform and prepaid card can

make money and the concept of value more tangible seemed initially counter-intuitive to

a majority of the study participants. However, this group found that the value-centered

lessons that they were attempting to convey through conversations, explanations of

financial transactions, manual systems, and lecturing were not positively affecting their

child’s approach to financial decisions or their spending and saving habits.

“FMVB gives them the tools to see how they are doing financially, what they’re

spending on,” explained P01. “It’s not me telling them. They can see it…It makes

spending visible and transparent.” P02 emphasized,

It is more concrete, It is more concrete. He can see it more openly. We’ve always

told him that your bank account gives you interest. But I think even being able to

see the interest amount [makes it] a little more tangible. Giving him 1% per

month, rather than .01% annually, allows him to feel it now.

P04 equated FMVB to a visual tool, an analogy echoed by P12 who indicated that there is

“no guessing game and hiding.” As P13 stated, “It is all laid out. You don’t have to think,

‘Oh! Where did I spend that $5?’ It’s all there for you and a little more controllable to

look at and see.” P02 stressed, “In a cash environment, there is no visibility.” One

subscriber P03 did, however, voice some caution. “It’s easy to spend money you can’t

see, and you don’t have in hand.”

Data informs decisions. Since using FMVB, the parent-subscribers I interviewed

have witnessed a shift in their children’s approach to spending and saving. They and their

children can now see the pattern and cumulative effect of routine expenditures ranging

from Legos to Frapuccinos to Uber rides. Two parents, one who has a child with ADHD,

shared how the use of FMVB affords their children the opportunity to “pause and think”

(P05) and “give it a minute” (P13). P05 shared,

Instead of buying [the Lego set] immediately, which he would have [with physical

cash], he now thinks about it, makes sure, figures out why he wants it…which I

know seems silly because it’s only a Lego set, but I’m hoping that process will

transfer over later in life.

P14 recounted how her son wanted to buy his girlfriend a gift for their one-year

anniversary, which he saved up for and purchased himself with his FMVB card. “He’s

making the decisions…he’s learning by doing it on his own.” Similarly, P13 noted how

the account balance that is displayed on FMVB app helps shape the children’s buying

decisions:

It’s a good visual to show them. Oh, this what I have, and if I spend it on that it’s

going to go down, unlike when they are holding money, which they sometimes

lose. And if they aren’t losing the money, then it becomes just as elusive – “Oh, I

have this money somewhere out in the world,” but it’s not as concrete. And it’s

very real when they make that transaction, and the money comes out, and they can

see it right on the app.

The parents I spoke with also noted how readily their children would ask them for

money or how quickly their child’s pocket money would disappear before they became

FMVB subscribers. P7 noted how much “more thoughtful” her children are with their

decisions, including their middle child who is “happy to spend more money.” P10

discussed how they wanted to put their children in charge of having a budget for

Christmas gifts that included making the list for people they wanted to buy for and do the

actual purchases themselves, which was a departure from previous years.

We gave them a budgeted amount [in FMVB]. It was very interesting to see the

two different ways they approached it. The younger daughter allocated $20 to

each person. And she’d identify things [online or in a store] that she thought a

person would like. But she would say, “I still have $5, what else could I find for

$5 to meet that $20 budget per person?” Whereas, my other daughter searched for

things that people would really like, but if it didn’t go to the full $20, she knew

she would have extra [in the account].

As P01 summarized, “Now when my son shops, it becomes a process. He consciously

asks, ‘Do I really want that action figure? Do I really want that game?’” For these FMVB

subscribers, the sense of ownership, accountability, transparency, and independence that

FMVB provides appears to be shaping their children’s spending decisions. Yet, the

benefits, as several parents explained, are not restricted to just the children.

Reaping reciprocal benefits. According to participants P04, P05, P06, P09, P10,

P12 and P16, the benefits of using FMVB to support productive financial lessons and

practices were not restricted to just the children. As P09 explained,

It’s helped our financial literacy. It’s helped me to be able to verbalize it and think

more long-term for my kids as well. [Prior to FMVB], I was on a short-term plan

with my kids…I was just trying to get them to understand what was going on

right now. [FMVB] is allowing us to take [our] planning to the longer-term goals,

which has really helped the financial literacy in our household.

P10 discussed that as she and her spouse began thinking about how best to support their

daughters’ financial education, it prompted them [the adult parents] to “get together our

finances.” It was around the same time that P04 and P12 signed up for FMVB that they

signed up for budgeting software. As P12 relayed,

It’s been a year of really intense sort of learning. And it’s been fun…I had never

thought about financial literacy being fun before. It’s like a whole new world now.

I need to get on the ball so that I could help my kids to make better decisions and

learn more. So, I think it’s been beneficial all around.

P05 discussed how she has earmarked the fourth FMVB prepaid card for savings, which

has allowed her to streamline the flow of money with her husband and son, both of whom

have ADHD.

So, if there’s an extra purchase that my husband needs to make…he’ll say, “Can

you just transfer some money over to my card?’ So he can do what he needs

to…without going to the ATM…It’s made it easier for him to kind of understand

what’s going on and to keep track of his money. I think [FMVB] is really going to

help our family stay on point. Having it separate from our bank account is really

helpful because…it’s compartmentalized.

Summary of Theme 1, RQ1.

• Parents found that FMVB makes the concepts of value and responsibility

more tangible, visible, and concrete.

• Parents experienced the shared benefits, alongside their child[ren], from

the structure and consistency that FMVB brought to household

responsibilities and the transactional and decision-making processes

associated with budgeting, spending, and saving.

Theme 2: Perceived shifts in family financial interactions attributed to FMVB

This theme is a product of the relationship dynamics and nuanced influence that

individuals and factors within and outside the nuclear family, including technology, had

on the financial socialization processes of the parents and children. As reflected in Figure

7, the theme addresses RQ2: What are parents’ perceptions of how the use of a fintech

tool supports conversation and transaction-based socialization activities between a parent

and child?

RQ2: What are parents’ perceptions of h ow the use of a fintech tool supports conversation and

transaction-based financial socialization activities between a parent and child?

Figure 7. Codes, categories, and descriptors associated with Theme 2 and RQ2.

Childhood shapes parents’ approach to financial socialization. The financial

socialization process that the parent-participants experienced themselves, productive or

counterproductive, provided insight on the rationale behind and approach to the practices

they are using with their own children. Several participants noted that their parents were

quiet on the subject of finances. P05 recounted, “I didn’t have any idea growing up. Other

than being told I should tithe on Sunday, and it’s good save…my parents didn’t really

share anything with me about their financial dealings.” P13 conveyed a similar

experience, “Growing up…my parents didn’t really talk about it. Nobody really talked to

me about saving money or how to responsibly spend my money.” Others, including P11,

discussed the mantras and warnings that they regularly heard.

I was definitely taught by my dad, who was obsessed and shared all his feelings

about how much we should spend and not spend, and to constantly save and buy

real estate….Every little thing we did, he would explain his philosophy on what

we buy or not buy, or how you handle things.

As P11 described it, “I definitely would not call it a dialogue [about finances]. It more of

a lecture.”

Most participants recalled that their hands-on experience with money growing up

was limited to the occasional small purchase (e.g., candy bar or ice cream) and the typical

way they learned about personal finance matters, other than listening, was by watching.

For P05 it was—

Basically seeing it [financial decisions and transactions]. Not so much to teach us

really, but seeing it in action. Seeing [my mother] budget, and comment to us as the store

that we only have such and such money. We don’t have extra this week. P09 reported,

“We were very poor, but mother was stellar with every penny she had. So she slowly built

herself up. I watched her do that and then I did the same thing for myself.” P15 disclosed

that her parents grew up in the Depression Era and used the envelope system for

budgeting. “So, that’s how I was brought up. Budget, budget, budget.” Others like P08

revealed, “I didn’t become educated [in personal finances] until

I was an adult.”

Many participants, including P10, recounted how they learned from there financial

mistakes. “When I finally got my own checking account and was doing the real work of

balancing and it was all on paper…my very first rent check bounced,” because she did

not know that the bank processes payments before deposits. Like P10, P11 had

professional parents, “but even with that they never taught me anything about financials.”

The approach, not the values, becomes time-worn. The prevalent feeling

among this group is that the long-standing maxims including, “Don’t live beyond your

means,” and “Save for a rainy day,” remain part of the values and lessons that they want

to instill in their children. However, how they support the development and application of

these values, even with FMVB, is challenging. As P15 emphasized, “I have all [my

children] so far, except for one, who seem to understand that you need to save money for

a rainy day. We’ve raised them all the same way. And her [approach to money] is not

something that you learn from FMVB or that we taught her…” Several parents bemoaned

that broader social influences are affecting their child’s financial orientation and habits.

P07 elaborated:

There’s a bit more material focus nowadays, at least in the environment that I’m

in, versus when I was younger. Their [children’s] social status is based on how much their

family has. So, there’s also just anxiety about self-worth and how you feel about your

family, and how you fit in the world in comparison to your peers. As P08 voiced,

I don’t care what generation that you’re from, there’s an enormous pressure to be

part of the “good” group…and I think that social media has hugely exacerbated

this problem. Unlike when I went the school, the only comparison was with the

kids in your classroom or hallway. Nowadays with social media, you can see what

the whole world is wearing, driving, and the kind of houses they live in. And this

kind of increased awareness puts our lifestyle and theirs (reference to children)

under a microscope.

P06, P07, and P10 were among a number of parents who noted the positive effect

that both responsible and comparatively extravagant behaviors among peers had on their

own children. P06 shared that her child’s best friend has a card similar to FMVB. “My

daughter sees her saving. So it pushes her to do the same.” P07 mentioned that unlike her

children, who have their own money on FMVB, their friends are “spending their mom

and dad’s money…and it doesn’t register for them like it does [my child]. She makes

thoughtful decisions now [with FMVB] that I don’t know she would have before

[FMVB].” P10 characterized her child as being a discerning consumer, which she

attributes in part to FMVB.

My younger daughter has a couple of friends who really glom onto trends…and

their parents will often get them…high-profile, brand-name items. My daughter

will look at those things a more critically and be like, “I’m not paying that much

for a pair of shoes.” So there’s some discernment there.

Fintech facilitates conversations. All parent-subscribers noted change in the

frequency, depth, and/or tone of the finance-centered conversations with their child(ren)

since they started using FMVB. As expressed by P09, who is navigating the challenges of

newly-formed blended family,

It surprises me how frequently now we talk about money, and how infrequently

before [FMVB} we weren’t talking about it, when we need to be. And it’s not a

point of contention anymore. I feel absolutely no frustration. It’s a learning

environment. They’re stimulated. They ask a ton of questions.

In a similar vein, P10 noted that because of FMVB, “You have a platform, a structure to

talk around, and clear examples that you can use. The tools that are offered with the

platform give parents ways to talk about money beyond managing it. It’s a tool for

creating those conversations.” P11 also indicated that the conversations are not only

happening more frequently, but they are more casual and less parent-directed, since they

occur in tandem with the transactions that occur routinely within the accounts.

Particularly noteworthy for several of the parents, including P10, was the fact that

FMVB is providing a bridge from talking about financial topics—to applying them using

the FMVB platform, calculators, and accounts—and extending the conversation to

longer-term decisions about employment and college.

It’s opened up conversations about future employment…They ask us. It’s not us

telling them or asking, “What do you want to do in the future?” They are starting

to realize the impact of career decisions [on their future financial state]. Without

those foundational conversations, it would be harder to make the leap…to your

goals.

P11 noted that as her family is starting to have more conversations about college and

what they could likely afford in three or four years, it is “filtering down to the smaller

purchases” and affecting the children’s short-term saving and spending decisions.

Parents manage attitudes through fintech. Money can be an emotion-laden

topic, as many of the parent-subscribers expressed, which the use of FMVB has helped

temper. “We’re on the same page [parents and children]. Everyone can open up the app

and see who has done what chores and if they have any money,” shared P09. “It’s not

personal…and I think it’s curbed some emotional spending habits.” P12 indicated, “It

[FMVB] has been a positive…for our family dynamics and well as for financial literacy.”

One parent who struggles with letting her children spend money on items she considers

frivolous said, “It’s [FMVB] caused a lot less arguments for the family, even in terms of

telling [the children] how to spend their money.”

The adult-subscribers to FMVB shared that despite their children growing up in

the same household with the same narrative and modeling around financial habits, their

children’s individual orientation toward money is as unique as their personality. My

middle child has the most conservative outlook, explained P01. She has an interesting

relationship with money and will stress over it. My oldest daughter is the opposite. Not

that she is frivolous, but she does have a huge heart. No amount is too great when it

comes to buying a gift for someone close. [Before FMVB] she went into debt buying a

dog for her boyfriend. She would spend beyond her means.

Other parents, including P02, discussed how FMVB has supported the different

orientations their children have toward spending and saving.

My youngest just piles up the money…Her [FMVB] is more like a savings

account, and she doesn’t really want to spend it very often. But my older one

wants every single thing under the sun. She’s a bit more materialist. [With

FMVB] she plots things out and understands how much things cost now in a

different way than before [FMVB]. She can see how much she has and she’s

paying for it herself, which gives that feeling of ownership. And I think that she’s

understanding the value of money, which can be lost on kids.

P03 also highlighted how FMVB helps manage the different timeline orientations and

spending mentalities of her children. “The younger one…is a little bit better with saving.

She’s thinking ahead to college and a car. And the older one, she’s more into what she

wants now.” P05 shared a similar perspective on her children.

He lives week-to-week like paycheck-to-paycheck. He just wants to spend. That’s

just the way he is. My daughter is more…I’m going to save because I have

plans…In my eyes, he doesn’t care. That’s just his personality. I don’t know if it’s

like a boy thing?

P02, the mother of three girls, conveyed that her younger one “likes to see the FMVB

balance going up. The middle one can spend all the time.” Another parent, P13, described

how she is positioning FMVB to support “the ideas of saving for a goal and not impulse

buying. That’s something I really would like to stick with them especially one of my kids

is very ‘right now, what’s the newest, the best, the latest.’ And I think that’s a really hard

way to live in life—to always want newer, better, and more right now.”

Summary of Theme 2, RQ2.

• Parents perceive that the use of FMVB has increased the frequency,

objectivity, productivity, and depth of personal finance conversations with

their child[ren].

• Parents perceive that FMVB helps align the unique and differing

individual attitudes and approaches toward money management that are

present within the family construct.

Theme 3: Parents’ proxy measures of financial literacy

This final theme accounts for the subjective indicators that parent-participants

used to assess differences in their child[ren]’s financial literacy level, which may be

attributed to the use of FMVB. See Figure 8 for additional detail on the factors associated

with the theme.

The parent-participants had well-defined, observable, and demarcated criteria for

what financial literacy, confidence, and capability looked like in their children. They also

qualified their subjective assessments of their child’s financial literacy levels using

comparisons to peers alongside their own expectations and observations as a

measurement standard. Most parents used the term financial literacy to explain their

child(ren)’s conceptual understanding of financial topics. “I feel like he’s got a better

grasp, in general, that money is a thing,” explained P02. “I think that some of his peers

don’t think that way. Goods and services just appear at the doorstep because mommy

made them.” Similarly, P05 noted, “I think the knowledge is there. It’s just that [financial

transactions and decisions] haven’t happened enough in his life yet for him to produce

that thought process himself yet.”

In terms of confidence, several parents noted reciprocal benefits to using FMVB

for the child(ren) and the adult-parent(s) in the household. P03 conveyed,

I know that both of them [children] really enjoy being able to go to the mall and

have their own debit card. And I think they feel sense of “I’m an adult. I’m kind

of grown up when I get to walk up the register with a card that has my name on it.

And I can buy things with the money that I’ve earned.” So, I think they’re very

confident in that.

P06 framed her assessment of children’s financial confidence this way:

Their confidence has increased because with all three of them, they will use their

own card to buy things that they want. When one daughter wanted a sweatshirt

from a concert…but didn’t get there…but wanted to get it online. [She said] “I’ll

pay for it myself. This is something I want to pay for myself…I’ve got enough

money. I’ll do it myself.” I think [their confidence] is more because they know

they have the money that they’ve earned themselves, and then they’ll find ways to

purchase on their own, and then they may just need a little bit of help in how to

exactly do the transaction [online].

P12 shared, “I’m feeling pretty confident about what my kids know and are able to do.

And I feel like FMVB in conjunction with [budget app that she and spouse are using]

made me feel more confident and able to teach my sons.” P06 conveyed that with FMVB,

“I’m very confident in knowing that I can talk to my kids, and I know as much as I need

to know.” P08 added a different perspective on how his son’s lack of financial confidence

is serving to motivate him to learn more.

His interest in money is because there is less security there. In other words, there

more of competitive insecurity in him. There’s this measurement between how

much [he knows about financial matters] and how he compares [himself] against

the rest of the world.

Capability yields confidence. Confidence as defined by this group of parents is a

product of capability, the children being able to conduct age-appropriate transactions

independently through FMVB. “My son is better grounded,” remarked P01. “FMVB

created a space for him to be in control and for us to have conversations.” P06 relayed, I

don’t have any involvement in their purchases. My son uses it to buy computer and

gaming things online. My daughter uses it socially…when they go out to eat or to the

movies. My kids are more self-reliant in that way ever since I had them

help me complete some things online. And I like for them to feel like they are

growing up and get that independence of where they don’t need my permission

for what they buy.

Several parents discussed how FMVB provided a managed-level of independence

and autonomy that resulted in their child[ren] feeling empowered yet accountable.

“[FMVB] gave them so much more control and autonomy over their own

decisionmaking,” explained P07. Perhaps P05 most succinctly captured that transfer of

control and accountability from parent to child that other parents alluded to: “Once I

throw the money on your card, that’s it. It’s your job to track that. You know that’s what

you have. It’s all there.” P07 emphasized, “It [FMVB] has given them so much more

control… They feel like they have much more voice in how they are spending their

money. It gave them so much more control and autonomy over their own decision

making.” Parents release control. Others alluded to their child’s management of the

FMVB debit card and associated accounts as providing a rite of passage with guardrails.

“It’s a very adult thing to have a debit card,” explained P07. “It’s like a rite of passage

that shows your children that they are responsible enough to possess something like that

and to deal with what it entails, which is money.” P08 echoed those sentiments: There

are two aspects to it [use of FMVB]. One is giving [the child] the buying power that the

debit card affords…[Second] he’s empowered. It’s his decision…and choice to make. He

has the tool and the mechanism to buy that Frapuccino. I just want him to be empowered

to make these little choices…All of the other stuff [reference to financial capability] will

come later. I hope.

Accountability accompanies empowerment. As the parents discussed this shift

in control and the resultant empowerment that the children may feel, several framed and

qualified their comments in terms of the associated accountability including P09: Here’s

what I love about FMVB. They get a reminder on their phone to do their chores, and if it

doesn’t get done, they get charged, and it’s not personal. There are no hurt feelings

involved. If you didn’t do it, there’s a monetary penalty…And when they’re bored, and

don’t have money to do anything, they [are experiencing] the consequences.

FMVB also serves as an accountability gatekeeper, as several parents noted, for

themselves. P13 explained,

Whenever my two sons get money, they hand it to me right away and say, “Put

this on my card.” Before they would try to put in their pocket...or give it to us, and we’d

throw it our pocket, and then we’re like, “Shoot, where did we put that?” So now, they

give their money right away to me always, and I put it on their card. Another parent, P10,

conveyed how her daughter sent her an invoice through the FMVB mobile application

because the parent failed to make a timely deposit based on a verbal request:

She said, “Mom, did you make that deposit to my FMVB account yet for those

chores?” And I said, “Oh, well I know we talked about it, but if you could write

down what you did and how much you think that’s worth.” But instead of writing

it on a piece of paper, she sent me a request through the FMVB app with an

invoice and in the details wrote this is what I did, and this is how much its worth.

P15 also noted that her children know that if she buys something for them, “I’m going to

take that money out of their FMVB account instantly when I get in the car. Other times

before [FMVB], maybe I might forget.”

Short-term practices segue to a long-term orientation. Understanding the value

of money coupled with the decision-making skills developed through FMVB will,

according to these parents, provide the springboard for longer-term, financiallysignificant

goals and decisions.

I want my children to have some sort of understanding of the value of money.

That’s my biggest goal overall, P14 relayed. I don’t want them to think that

everything is just going to be handed to them…I want them to understand how

they can go about acquiring it, but do it a way that makes them happy…Succeed

at school, go to college, get a job, and be able to support themselves.

Several others, including P5, discussed how they position the FMVB prepaid card as their

child[ren]’s “training wheels” for a credit card:

My husband and I tossed around the idea of not just getting [FMVB] for my son’s

allowance, but for him to learn how to use a card more responsibly than getting a

credit card for the first time and all the woes that come with that.

Most every parent stated that their primary, long-term financial education

objective with their child[ren] is to teach them the importance of saving for a future goal.

As P02 expressed, “The long term hasn’t pieced together for [his son] yet...I think [the

savings account in FMVB] is going to help open up the conversation when he wants to

save for something bigger.” P03 stated, “I would like for them [the children] to learn the

importance of saving and be in a better position than my husband and I are…I just want

them to be wise with their money and be savers.”

Several parents conveyed how they are using FMVB to develop that savings

orientation in their children. P07 shared,

We just started their savings accounts [in FMVB]. The little one wants a computer

and the middle one wants a car. I think this is really helpful for them as young

kids to be able to set a goal and then work towards it.

P11 shared that any money the children are gifted goes directly into the FMVB savings

account. “Whenever that happens, I always try to talk to them. ‘What’s your next big

thing you’re saving for right now.” P05 shared a comparable approach,

My goal is to have them [the children] let me know what is that one thing that you

want to buy. “Okay, well, let’s work towards it. Is there a way you can make extra

money so you can get to that goal?” I really think that it’s [reference to FMVB

and the goal setting] going to help them be independent and hopefully learn to

care about their finances.

Several parents noted how their children are using the interest and savings

contribution calculators on FMVB to establish saving targets and timelines. P07 relayed

an example with her child, “Mom, I just the calculations and at $13 a week, it’s going to

take me three years to get the computer I want. That’s too long.” This parent decided to

match their child’s monthly contribution and summarized her objective:

So now I think they’re going to be much more willing to do that [save], because

they have some goal in mind…But the whole idea of focusing on a goal and then

achieving it financially, I think it’s going to be really important for them now, so

that when they become adults, it’s easier to do, hopefully.

Summary of Theme 3, RQ3.

• Parents perceive that the use of FMVB has bolstered their children’s

agecommensurate financial autonomy, accountability, knowledge,

capability and confidence to make informed financial transactions and

decisions.

• Parents revealed that the tandem use of the FMVB platform and access to

common, real-time data have increased their confidence and comfort level

initiating and discussing immediate and long-term financial transactions,

decisions, and goals with their children.

Summary

In this chapter, I recapped the purpose of this study and associated research

questions. I presented the setting for the study and included summary, descriptive data

about the participants. I also discussed the steps taken to promote the trustworthiness of

this study. A discussion of how I collected the data and the method I used to analyze it

was also included. I presented the findings in a format consistent with thematic analysis

and addressed each of the research questions that served as the basis of this study.

In Chapter 5, I will interpret the findings and their potential value for stakeholders

including educators, public policy officials, and families. I will also outline

recommendations for future research and realistic implications for positive social change.

Chapter 5: Discussion, Conclusions, and Recommendations

Introduction

This chapter begins with an overview of the rationale for this study, summarizes

relevant research that anchored this work, recaps the research questions that informed and

guided the data collection, and introduces the resultant findings. From there, I interpret

the findings within the context of the extant literature and conceptual framework and

revisit the limitations to trustworthiness that I experienced during the study. To conclude

the chapter, I identify opportunities for future research and discuss potential implications

for actionable social change by stakeholder group.

The purpose of this basic qualitative study was to explore parents’ experience with

and perceptions of the use of a fintech tool to support family financial socialization and

the associated financial literacy levels of parents and children. It was designed to address

a gap in the research related to fintech’s potential to bolster factors that contribute to

financial literacy.

The prevailing scholarship on the present and prospective value of financial

literacy efforts is mired by conflicting definitions of what financial literacy looks and

sounds like, inconsistent measurement systems, varying levels of instructional rigor, and

differences in teacher confidence and capability with personal finance matters and content

instruction (Consumer Financial Protection Bureau, 2019; Kaiser et al., 2020; Kaiser &

Menkhoff, 2016; Kasman et al., 2018; Lusardi et al., 2018; Walstad et al., 2017). Yet,

within this ambiguous research base, there are proof points of factors that consistently

and positively affect financial literacy levels. Those factors include the purposeful and

informed involvement of family members, access to financial services and products, and

the experiential learning opportunities associated with handling money that are now

ubiquitous on mobile and digital devices (Aber et al., 2016; Amagir et al., 2018; Batty et

al., 2015; Bosch et al., 2016; Brown & Taylor, 2016; Fraczek & Klimontowicz, 2015;

LeBaron et al., 2019; LeBaron, et al., 2018; Lusardi et al., 2017; Moreno-Herrero et al.,

2018; OEDC, 2020; Smith et al., 2018). This study acknowledges the pivotal role of

parents and fintech’s potential to redefine financial socialization and authentic learning

processes, which are key levers to financial literacy.

Through a series of semistructured, in-depth interviews with 16 adult-subscribers

to FMVB, I delved into a specific set of financial-literacy-related factors that emanated

from the following research questions:

RQ1: What are parents’ experiences with the use of a fintech tool to interact with

their child(ren) about financial concepts and decisions?

RQ2: What are parents’ perceptions of how the use of a fintech tool supports

conversation and transaction-based financial socialization activities between a parent and

child?

RQ3: What differences in financial literacy levels do parents perceive based on

their tandem use of a financial technology application with their child(ren)?

The adult-participants and I discussed the content and nature of finance-related

conversations among their family members, alongside explicit and tacit modeling of

financial behaviors and decisions that occurred prior to and since subscribing to FMVB. I

also inquired about the situational contexts, separate from, and facilitated by FMVB, in

which the adults and their children applied financial knowledge and skills. The high-level

findings from these interviews, which will be further qualified in the context of the

study’s research questions and examined in relation to extant literature and the study’s

conceptual framework, are summarized in Figure 9.

Interpretation of the Findings

Answers in Relation to the Literature

RQ1: What are parents’ experiences with the use of a fintech tool to interact

with their child(ren) about financial concepts and decisions? The parent-subscribers I

interviewed first experienced the FMVB platform as a solution to an existing problem

(e.g., the arguments around chores, limited accountability or accounting for spending, and

no mechanism to access funds safely). They subsequently found that FMVB’s

functionality lends itself to facilitating broader conversations and financial literacy

Figure 9

. Consolidated findings

from in

depth, semistructured interviews.

lessons centered on the concept of value and longer-term savings. Parents noted that the

app-accessible, real-time data tied to savings, payments, and allowances/chores makes the

seemingly nebulous and complex concepts of value and budgeting more visible and

tangible. The emphasis that the parents in this study placed on indoctrinating their

children to the time value of money is validated in the literature. Researchers, including

Bosch et al. (2016) and Jorgensen et al. (2019), highlight the connection between

presentday, money-management patterns and orientations in relation to future financial

independence and well-being.

All the FMVB subscribers I interviewed asserted that the digital payment and

tracking system makes money more visible. This finding and the study participants’

collective experience does stand in contrast to the caution raised by Rosa-Holyoak et al.

(2018) and Lusardi et al. (2018). The former research team contended that with electronic

transactions children do not see their parents setting aside physical currency for savings

or writing checks to pay bills, which may hinder the parents’ attempts to explicitly model

positive financial socialization and decision-making behaviors (Rosa-Holyoak et al.,

2018). Lusardi et al. also warned that the lack of physical connection to money may

exacerbate deleterious financial behaviors. P04’s commentary reflected the general

sentiment of the parents regarding these concerns:

I've gone back and forth between do they [children] really understand how much

they have [on the FMVB prepaid debit card]. And although I do agree [with the

concerns raised by researchers] to a point, that’s someone talking about a credit

card situation. With [FMVB], you’re basically walking around with your bank

account, and you’re able to see at any given point what is available to you.

There is agreement, however, among researchers and the parent-participants in

this study on the value of having children be responsible for their money, engaging in

financial transactions, and experiencing the benefits and consequences of the decisions

they make during their childhood and adolescent years. Parents explained that FMVB’s

prepaid debit card and app give their children authority, autonomy, and accountability in

relation to their money. Researchers including Bamforth et al. (2018), Riach et al. (2017),

Gudmunson et al. (2016), LeBaron et al. (2019), and Rudeloff (2019) concurred that the

experiential learning opportunities initiated by parents not only allow children to apply

the money scripts they have heard, but also to develop the foundational financial

decision-making strategies that will carry forward to adulthood.

The structure and transparency that FMVB brought to daily payment transactions

and money transfers by and between family members also created an opening for parents

to focus on their own financial planning and goals. Many of the parents in the study

found that through their use of FMVB they now had the motivation and foundational

skills to better manage their own spending patterns, formulate a household budget, and

focus long term. These parents, including P12, experienced the reciprocal benefits of

family-centered, financial socialization practices. “It’s a whole new world now...I needed

to get on the ball so that I could help my kids to make better decisions and to learn more.

So, I think it's been beneficial all around.” This positive cross-generational effect of

purposeful family financial socialization is corroborated by the research teams of

Bhattacharya et al. (2016), Britt (2016), Gudmunson and Danes, (2011) and

MorenoHerrero et al. (2018), whose members have also questioned why most financial

education programs fail to include the family.

RQ 2: What are parents’ perceptions of how the use of a fintech tool supports

conversation and transaction-based financial socialization activities between a

parent and child? Parent-participants admitted that the content of their conversation-

based lessons, which in many instances transitioned into one-sided lectures, either

reflected or attempted to compensate for their childhood introduction to personal finance.

This group also acknowledged that the enduring lessons on sound financial practices may

be timeless but maintained that the sit-and-listen and paper-and-pen approach to

conveying those lessons is outdated and ineffective with their children. All the parents in

this study noted and acquiesced to the fact that their children, unlike when they were

growing up, are subjected to an expansive set of influencers, in-person and media-based.

The money messages displayed by these influencers often conflict with the conservative

orientation toward spending that the parents in this study are attempting to instill in their

children.

Although the parent-participants often felt that external financial socialization

agents, in particular peers and social-media influencers, were undermining their efforts,

researchers have suggested otherwise. They indicated that parents have the greatest and

lasting influence on their child’s future financial practices and orientations starting at a

young age and continuing through adulthood (Bamforth et al., 2018; Jorgensen et al.,

2019; LeBaron, Rosa-Holyoak, et al., 2018; Serido & Deenanath, 2016). However, as the

parent-participants mentioned and researchers concede, the effect of the parents’ attempts

to positively socialize a child into a productive financial mindset and behavior pattern are

tempered by the quality of their overall relationship with that child (Gudmunson &

Danes, 2011; Jorgensen et al., 2017; Riach et al., 2017).

That being said, the parents in this study experienced and researchers contend that

the process of engaging in financial activities, which in this instance is through the

FMVB fintech tool, may compensate for and improve parent-child dynamics, limited

family financial socialization, and the parents’ lack of confidence with financial content

(Kagotho et al., 2017; Serido & Deenanath, 2016). One of the most candid accounts of

the negative interplay between family dynamics and finances that a parent abated by

FMVB was conveyed by P09:

You know what is sad though, we were, I was, having trouble instilling those

same [financial] values in my kids, and it was really affecting our relationship in a

very negative way. They were a complete irritant to me, which is terrible to say,

but it's the truth. I was so tired. I was so tired of repeating myself and asking my

children to do the same thing over and over and over. And it's the “I'll do it later

attitude.” And while their intentions were great, it would never get done. And it

was making me bonkers. And that's what I love about FMVB. I mean, they [the

children] get a reminder on their phone. And if it doesn't get done, they get

charged and it's not personal. There are no hurt feelings involved. It's, “You didn't

do it.” I don't have to ask them repeatedly.

The research is replete with examples of and evidence supporting the benefits of

parents engaging children early and often in authentic, hands-on, personal-finance-related

learning opportunities (Amagir et al., 2018; Arnold & Rhyne, 2016; LeBaron et al., 2019;

Serido & Deenanath, 2016; Tang, 2017; Xiao & Porto, 2017). Yet, as the

parentparticipants expressed, comparison-shopping and making small purchases with

cash, fails to place these discrete transactions in the broader context of assessing spending

patterns or forgoing a purchase to save for a future goal. Palakvangsa-Na-Ayudhya et al.

(2017) and Carlin et al. (2017) alluded to the potential, as in the case of FMVB, of fintech

that combines a data dashboard and user interface to support both family-centered

interactions and financial literacy objectives, the multiple factors researchers know and

parents perceived influence financial literacy levels.

RQ3: What differences in financial literacy levels do parents perceive based

on their tandem use of a financial technology application with their child(ren)? In

this study, parents used their subjective assessment of the following factors as a

composite benchmark for perceived short-term differences in financial literacy levels,

which they attribute to the use of FMVB:

• Depth of financial conversations.

• Demonstrated capability to use the data and calculators on FMVB to make

financial decisions.

• Confidence in the current level of financial knowledge and skill to support

an informed decision-making process.

All the parent-participants highlighted positive differences they perceived, from

both the parent and child side, in relation to the data-driven content and complexity of the

conversations facilitated by FMVB. Yet, responses from the parent-participants did vary

when they discussed factors that they perceive contribute to financial confidence. For

several parents, their renewed financial confidence was the anthesis of conflict avoidance

given the pre-FMVB history of contentious conversations around household

responsibilities, money earned and owed, and spending. Other parents alluded to how the

shared used of the platform gave them the confidence and information they need to be

able to teach their children age-appropriate, accurate information on topics such as

budgeting.

The differences in confidence levels that parents perceive in their children and

attribute to FMVB varied in terms of direction and origin. Most related their child(ren)’s

increased confidence to the autonomy and accountability their child(ren) now have over

their money. This assertion is consistent with the 2018 PISA financial literacy assessment,

which found that students who reported they were more independent in their spending

decisions scored 30 points higher (OECD, 2020). Moreover, studentparticipants who had

a payment or debit card scored 21 higher than their 15-year-old counterparts who did not

have or know what a debit or prepaid card is (OECD, 2020).

Strikingly, P08 described his child’s diminished financial confidence as a positive

outgrowth of using FMVB, which has motivated his son to learn more about financial

markets:

[FMVB] has engendered these other discussions...this larger discussion, “Do you

think we should take a portion of your savings and invested in equities or in

bonds?” He doesn't know what those things are, but he knows that there's a

mechanism out there. He knows that there's something called the stock market.

He knows that it exists, and he's already come back to ask me questions. “Well,

what is a share? How does the stock market work?” We haven't done anything yet.

I'm waiting for him to kind of get there, but I can see already, I can see the little

wheels of his mind turning. He understands that just like you're saving your

allowance, just because you buy a share of Apple stock, or whatever it is, it

doesn't mean that you're going to make a lot of money next week, or even next

month, or even next year.

The subjectivity and challenge of isolating and measuring the contributing factors

to, codeterminants of, and proxies for financial literacy is also acknowledged in the

literature (Tang, Ning & Peter, 2015; Xiao & Porto, 2017). One outstanding question

centered on the combination of subjective and objective factors (i.e., financial

socialization practices, application, attitudes and orientations, education, confidence) that

has the most effect on resultant literacy levels and future financial behaviors. Several

researchers, including Xiao and Porto (2017), assert that an accurate, holistic measure of

financial literacy needs to include self-reported measures such as confidence. Yet, false

financial confidence enabled by and acted upon through untethered access to technology

can foster and form irresponsible financial behavior patterns in adolescents (Amagir et

al., 2018; Yakoboski & Lusardi, 2018).

Parents in this study did qualify their assessment of present-day differences in

financial literacy levels in terms of longer-term objectives backed by the use of FMVB.

They spoke of their intention to foster responsible money management skills through

FMVB that hopefully carry forward to more complex decisions and translate into a

lifelong orientation toward saving for goals. The research literature is mixed as to how

childhood or proximal financial socialization activities and orientations shape distal

financial attitudes and behaviors. Several parents in this study worried that their child’s

apathetic or contrary attitude toward money would carry forth despite their current efforts

to reshape their behaviors through the use of FMVB. As P15 explained,

I have all of them so far, except for one, who seem to understand that you need to

save money for a rainy day. And that was not something learned from FMVB or

that we taught her. We raised them all the same way. The same amount of

influence on finance, and we have one that cannot save money. She’s horrible

[managing money].

One possibility, as reported by Smith et al. (2018), is that a child’s

spending/saving orientation has formed as early as age five. Most researchers concur that

childhood, family-based financial socialization activities, in particular active engagement

in financial activities, do shape the financial behaviors of emerging adults (Deenanath et

al., 2019; Fraczek & Klimontowicz, 2015; Jorgensen et al., 2017; Kagotho et al., 2017).

Perhaps, the findings from the present research study, coupled with the extant literature

on factors that contribute to sustainable changes in financial behaviors and associated

literacy levels, speak to the value of exposing children to consistent, accurate, and

multiple financial socialization touchpoints throughout their childhood and adolescence

years that include, but are not relegated to, the authentic financial experiences that fintech

can provide.

Framing the Findings

The conceptual framework for this study, as depicted in Figure 10, positioned

fintech, specifically FMVB, as the facilitator of family financial socialization practices

and the authentic learning platform through which subscribers apply their financial

knowledge and skills and engage in financial transactions. It is this combination of

financial socialization and application, orchestrated through the FMVB fintech tool, that I

wanted to examine in relation to perceived differences in financial literacy levels.

Figure 10. Study’s conceptual framework. Fintech’s role in bridging, informing, and

supporting components of family financial socialization and situated cognition theories

and associated financial literacy levels. Adapted from Gudmunson and Danes (2011) and

Brown et al. (1989). (This figure originally appeared as Figure 1 in Chapter 1.)

I explored the applicability of Gudmunson and Danes' (2011) financial

socialization theory through RQ2 and the related interview questions that centered on the

parents’ thoughts and experiences with the type and level of support that FMVB provided

to money-centered conversations and activities with their children. Through interview

questions aligned to RQ1 and RQ3, I explored parents’ perceptions and experiences with

how or if FMVB served as the apprentice platform described by Brown et al. (1989) in

their theory of situation cognition. Specifically, I sought to understand how the

socialization-related practices and outcomes associated with financial messages and

conceptual knowledge were applied in the context of FMVB and in relation to perceived

differences in financial literacy levels.

Technology enabled family financial socialization. FMVB’s role in supporting

productive family financial socialization practices was evident in my research.

Parentsubscribers consistently cited how the objective data generated by the shared use of

FMVB with their child(ren) changed some combination of the tone, content, and depth of

their personal-finance related interactions. Gudmunson and Danes’ (2011) socialization

theory surmised that most socialization practices undertaken by the family would be

nonpurposive and be part of perfunctory daily activities. Their supposition stands in

contrast to the findings from this study in which the parents highlighted how the real-time

data and tools embedded in FMVB shifted their intentional money-centered conversations

and lessons from a one-sided, compartmentalized exchange about a singular transaction

or decision to a more purposive, goal-oriented interaction that was now often initiated by

the child.

Although technology as a socialization practice or platform was not specifically

addressed in Gudmunson and Danes’ (2011) initial family financial socialization

conceptual model, subsequent application of the model did account for changes in

financial socialization agents (i.e., friends, teachers, and media) that occur across life

stages (Shim et al., 2015). In effect, the introduction of family-managed financial

technology in the context of this study serves to expand the list of socialization agents

and anchors the relevance of family financial socialization in the evolving digital

financial landscape.

My findings also speak to how FMVB was positioned by the parents as a

transitional tool. It provided needed structured, made abstract money messages more

tangible, and helped adult and child-subscribers consider the value and cost of

discretionary purchases in the context of longer-term goals. For example, P01 stated that

her objective in subscribing to FMVB centered on “helping them [her children] to

establish goals. Giving them the tools to see how they are doing financially, where their

spending habits are. Not me telling them. They can see it.”

The tenets of family financial socialization assert that family relationships and the

lesser-seen purposive, finance-centered interactions contribute to “financial attitudes,

knowledge, and capability, which in turn contribute to distal outcomes, financial behavior

and financial wellbeing” (Gudmunson et al., 2016, p. 64). By extension, applying this

theory to the present study and positioning FMVB and comparably-gated fintech products

as financial socialization agents may illustrate fintech’s potential to facilitate sustained

changes in financial attitudes and behaviors, which underpin financial literacy goals.

Situating financial learning in the context of fintech. In their theory of situated

cognition, Brown et al. (1989) profess that knowledge or cognition is constructed

individually or socially. Consistent with Gudmunson and Danes’ (2011) model, the

FMVB children and their parents may acquire some or all of their financial knowledge as

part of the family financial socialization process facilitated by this fintech tool. Parent

responses, nevertheless, suggested that knowing discrete personal finance concepts is not

their intended goal. Rather, their objective is to have their child(ren) learn how to apply

that knowledge to increasingly complex financial situations that accompany each life

stage. The parents have, in effect, situated that content knowledge within the learning

environment of FMVB to support the transition from decontextualized financial

definitions and mantras to authentic application. Parents have positioned FMVB as a

cognitive apprenticeship through which they are assimilating the family members into

social interactions and authentic financial practices that form the basis of applied

financial literacy (Brown et al., 1989).

Similarly, Clancey (2008) argues from a constructivist epistemology that situated

cognition and learning needs to account for the social, dynamic environment in which

those cognitions are formed and eventually applied. In the present study, FMVB was the

parallel authentic, social, and constructivist environment in which financial literacy is

learned and financial behaviors are shaped. The effectiveness of attempting to simulate

authentic learning environments was called into question by Brown et al. (1989):

“When authentic activities are transferred to the classroom, their context is inevitably

transmuted; they become classroom tasks and part of the school culture” (“Authentic

Activity,” para. 5).

Parents in this study extolled the perceived value of school-based personal finance

courses, and noted despondently that neither their child(ren) nor they had taken one.

Although the prevailing design of these courses may support knowledge construction and

facilitate transference, they cannot, in accordance with situated cognition theory, fully

replicate the authentic, family-influenced context in which financial decisions are made

and executed. This incongruence between classroom-based applied learning and authentic

learning may explain, in part, the mixed reviews on the effectiveness of financial

education (Kaiser et al., 2020; Zhu et al., 2019).

The FMVB archetype facilitates family financial socialization and provides the

authentically-situated, digital context to apply financial knowledge and skills. It supports,

as depicted in Figure 10, the organic interplay of family and situational factors that

account for the differences in financial literacy that parent-participants perceived.

Limitations to the Study

During the proposal phase for this study, I identified the following limitations to

this study:

• The quality and relevance of the information obtained through the interview

process depends, in part, on the interview techniques and the construct of the

questions.

To compensate for this potential limitation, I outreached to leading researchers in

the personal finance field to solicit their input on interview questions. I also conducted

practice interviews with two researchers and two parent-educators who teach personal

finance. From there, I refined the interview questions based on their feedback and my

analysis of the mock interview findings in relation to the research questions.

• My volunteer work centers on promoting financial literacy in the K-16 student

and underserved populations, and I also teach personal finance classes. So, I

am optimistic about the potential for fintech to address the transference gap

between classroom-based financial education, actual financial behaviors, and

resultant literacy levels.

To offset this limitation, I disclosed my personal-finance-related work in the study

recruitment material; kept a reflective journal of my coding nodes, descriptors, and

rationale; and actively looked for contrary data as I interpreted my findings.

• The setting for this study and participant pool was limited to the subscriber

base of one fintech tool, FMVB, which may call into question the

generalizability of the findings.

To promote the application of my findings beyond this study, I did not address the

features and functions of FMVB in my research and interview questions. Instead, I

focused on personal finance concepts, conversations, skills, behaviors, and attitudes

associated with financial literacy and that are rooted in extant literature and the

conceptual framework. I asked parent-subscribers about their experiences and perceptions

of using FMVB in relation to these broader, transferrable components of financialliteracy.

As I conducted the study, I did not encounter any additional limitations.

Recommendations

The role of fintech in relation to the broader base of research on personal finance

education and the effectiveness of financial literacy interventions is an emerging area of

research. According, the following recommendations are based on my findings, the

limitations of this present study, and related recommendations from the literature.

Although this study included short-term subscribers to FMVB, 13 of the 15 families with

children had been using it for less than 1 year, and none of the children had taken a

formal personal finance class, I could not fully account for additional factors that may

have influenced the parents’ perceptions of differences in financial literacy levels that

they attributed to FMVB. Accordingly, I would recommend that future studies include a

randomized controlled trial in which FMVB or a comparable fintech tool is positioned as

an intervention with the objective of measuring its effectiveness to support changes in

financial literacy levels.

I would also suggest that future studies explore the potential application of FMVB

and similar fintech tools to support the elderly, individuals with addiction, and those with

developmental, behavioral, and social challenges, who would benefit from fintechenabled

and managed autonomy in their daily financial transactions. This recommendation

emanates in part from this study’s one, previously-identified, discrepant case, which

involved an adult FMVB subscriber who had positioned his spouse as the parent to

provide accountability and oversight of his spending as part of his ongoing recovery from

a gambling addiction. This recommendation also honors a request made by several

parent-participants who have a spouse and/or child with ADHD or Asperger’s. They

asked that I convey their positive experience with FMVB in hopes of helping others in

comparable situations who are trying to bring routines, structure, and consistency to

financial lessons and transactions.

Another phenomenon worthy of further research would build upon the work of

Batty et al. (2018) and Smith et al. (2018) and examine how early-childhood orientations

toward money may be shaped through family-centered, technology-supported,

authenticlearning opportunities that are facilitated by a platform such as FMVB. Within

this present study, most parents noted that their child(ren)’s attitude toward money

differed from their own or that of their sibling(s). They wondered how or if the use of

FMVB would influence those tendencies long term. Accordingly, a longitudinal study

that explores the effect of FMVB or a comparable tool on financial attitudes and

associated behaviors would provide additional evidence-based insight on when, how, or if

fintech may be best positioned to support productive spending and saving orientations.

Implications

The findings and recommendations from this study may inform future policy and

programmatic initiatives related to purposeful parental involvement in financial education

and the use of financial technology to support the financial well-being of the next

generation of emerging adults and the vulnerable members of our population. The

following implications identify fintech-enabled opportunities on a national, state,

classroom, and family level to support financial literacy. The opportunities are informed

by this body of research and my work across these sectors. Equally important, I account

for the fact that any policy or programmatic shift needs to include a funding stream,

which is where I begin my discussion.

On a federal level, Title IV of the Elementary and Secondary Education Act

(ESSA) includes grant funding for financial literacy programs, a portion of which could

be earmarked for research and pilot studies related to fintech and financial literacy. (Title

IV 21’st Century Schools, 2019). This legislative change could be initiated by members of

the bi-partisan Financial Literacy Caucus who were responsible for the initial expansion

of Title IV and would support broader national objectives of identifying quality, effective,

and scalable approaches to financial education.

State treasurers, in concert with their national association, continue to champion a

personal finance requirement at the high-school level (National Association of State

Treasurers (NAST), n.d.). This advocacy work is rooted in the broader social objective of

enabling access to financial products and developing financially-literate citizens who can

“avoid pitfalls and navigate the financial world with success” (Office of RI General

Treasurer, 2018, p. 7). State treasury officials are positioned to encourage and partner

with their post-secondary institutions to support pilot programs designed to measure the

effect of FMVB or comparable product on financial literacy levels, behaviors, and distal

objectives across varied populations and programs.

Specifically, FMVB may be positioned as a complementary product to

statesupported child and individual development accounts (CDAs and IDAs), which are

designed to help individuals save for a financial goal (e.g., college, car, starting a

business). Within state-affiliated congregate care settings including group homes,

residential treatment programs, and correctional facilities that house members of our most

vulnerable populations, FMVB or similar fintech tool can provide managed-access to a

digital financial product while promoting financial literacy and inclusion for these

citizens. As suggested by several FMVB study participations, the traditional profile of a

subscriber—parent and child—fails to account for its more inclusive application and

value to a broader base of individuals who need the structure, scaffolding, and access to

financial products that FMVB can provide.

At the level of the Local Education Agency (LEA), parent-teacher organizations

with support from post-secondary researchers can position FMVB as an extension of the

classroom-based instruction related to financial topics. For families, FMVB may promote

productive, informed financial conversations and practices similar to those experienced

by the parents in this study. FMVB can also support the application of

classroomconstructed financial knowledge, which is the critical transference component

that school-based experiential learning cannot replicate (Brown et al., 1989; Gudmunson

& Danes, 2011). For the administrators and teachers, this undertaking may produce the

playbook of strategies that promote meaningful parental engagement in support of student

literacy and achievement across content areas (OECD, 2020).

Conclusion

Casting fintech as a financial literacy tool is not the panacea for financial inequity

and insecurity on a family and community level. However, positioning a family-managed

virtual bank and prepaid debit card service (FMVB) as an applied learning environment,

where individuals can experience autonomy and accountability while developing the

confidence and capability to manage their own finances, can be empowering. Through

further studies and use in settings outside the traditional family construct, FMVB’s

potential to facilitate the transfer of financial education, support productive

moneycentered socialization activities and decisions, and scale financial capability may

be validated. Technology is driving expanded access to financial products. FMVB may

the platform that drives a deeper examination of fintech’s complementary potential—to

elevate financial literacy, resilience, and social responsibility.

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