Responses to Economic Pressure by Low-Income Families: Financial Distress and Hopefulness

Prawitz, Aimee D.; Kalkowski, Julie C.; Cohart, Judith

doi:10.1007/s10834-012-9288-1

Original Paper
Published: 22 February 2012

Responses to Economic Pressure by Low-Income Families: Financial Distress and Hopefulness

Aimee D. Prawitz¹,
Julie C. Kalkowski² &
Judith Cohart³

Journal of Family and Economic Issues volume 34, pages 29–40 (2013)Cite this article

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Abstract

Based on Boss’ family stress model, the study examined whether financial adaptations and locus of control mediated levels of financial distress and hopefulness for low-income consumers experiencing economic pressure. Data were collected online from 221 low-income, Midwestern consumers. Structural equation modeling explored relationships. Those reporting more economic pressure reported higher financial distress, less hopefulness. When locus of control was more internal, however, participants reported less financial distress and more hopefulness. Those making more financial adjustments had more financial distress, but also more hopefulness, indicating that while the current situation was grim, adaptive responses fostered hopefulness that things would improve. Educators can emphasize financial behaviors that improve financial outcomes, facilitating greater perceived control over finances, more hopefulness, and reduced financial distress.

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Acknowledgments

This research was supported by a Grant from the FINRA Investor Education Foundation through a partnership with United Way Worldwide. All results, interpretations and conclusions expressed are those of the authors alone and do not necessarily represent the views of the FINRA Investor Education Foundation, any of its affiliated companies, or United Way Worldwide.

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Authors and Affiliations

School of Family, Consumer, and Nutrition Sciences, Northern Illinois University, DeKalb, IL, 60178, USA
Aimee D. Prawitz
Financial Hope Coalition, College of Business Administration, Creighton University, Omaha, NE, USA
Julie C. Kalkowski
Personal Finance Employee Education Foundation, Alexandria, VA, USA
Judith Cohart

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Aimee D. Prawitz
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Julie C. Kalkowski
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Prawitz, A.D., Kalkowski, J.C. & Cohart, J. Responses to Economic Pressure by Low-Income Families: Financial Distress and Hopefulness. J Fam Econ Iss 34, 29–40 (2013). https://doi.org/10.1007/s10834-012-9288-1

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Published: 22 February 2012
Issue Date: March 2013
DOI: https://doi.org/10.1007/s10834-012-9288-1

Keywords

Economic pressure
Financial adjustments
Financial distress
Hopefulness
Locus of control