Chapter

Consumer Knowledge and Financial Decisions

Part of the series International Series on Consumer Science pp 197-214

Date:

Debtors’ Assessments of Bankruptcy Financial Education

  • Deborah ThorneAffiliated withDepartment of Sociology and Anthropology, Ohio University Email author 
  • , Katherine PorterAffiliated withUniversity of California, Irvine School of Law

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Abstract

Bankruptcy law now requires individuals to complete a financial education class to receive a discharge of debts. Using data from the 2007 Consumer Bankruptcy Project, this chapter examines debtors’ attitudes about the value of financial education. The data show that debtors’ attitudes vary by race, educational attainment, age, and familiarity with household finances. While many debtors express optimism about the future benefits of financial education, only about one in three debtors believes financial education could have prevented their bankruptcy. These findings have implications for designing financial education curricula and for understanding the causal relationship between financial distress and financial knowledge.