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Article Open Access November 19, 2024

High Education, Low Returns: Financial Literacy Challenges for African Americans and Hispanics

Shervin Assari 1, 2, 3,*, Hossein Zare 4, 5 and Amanda Sonnega 6
1
Marginalized-Related Diminished Returns (MDRs) Research Center, Los Angeles, CA, USA
2
Department of Family Medicine, Charles R. Drew University of Medicine and Science, Los Angeles, CA, USA
3
Department of Urban Public Health, Charles R. Drew University of Medicine and Science, Los Angeles, CA, USA
4
Department of Health Policy and Management, Johns Hopkins Bloomberg School of Public Health, Baltimore, MD, USA
5
School of Business, University of Maryland Global Campus (UMGC), Adelphi, MD, USA
6
Institute for Social Research, University of Michigan, Ann Arbor, CA, USA
Publihed in: Current Research in Public Health (Volume 4, Issue 6, 2024)
Page(s): 381-391
DOI: 10.31586/ojer.2024.1112
Received
June 20, 2024
Revised
August 23, 2024
Accepted
November 12, 2024
Published
November 19, 2024
Keywords
Financial Literacy; Educational Attainment; Minorities' Diminished Returns; Racial Disparities; Hispanic; African American; Ethnic Groups
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright: Copyright © The Author(s), 2024. Published by Scientific Publications
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APA Style
Assari, S. , Zare, H. , & Sonnega, A. (2024). High Education, Low Returns: Financial Literacy Challenges for African Americans and Hispanics. Current Research in Public Health, 4(6), 381-391. https://doi.org/10.31586/ojer.2024.1112
ACS Style
Assari, S. ; Zare, H. ; Sonnega, A. High Education, Low Returns: Financial Literacy Challenges for African Americans and Hispanics. Current Research in Public Health 2024 4(6), 381-391. https://doi.org/10.31586/ojer.2024.1112
Chicago/Turabian Style
Assari, Shervin, Hossein Zare, and Amanda Sonnega. 2024. "High Education, Low Returns: Financial Literacy Challenges for African Americans and Hispanics". Current Research in Public Health 4, no. 6: 381-391. https://doi.org/10.31586/ojer.2024.1112
AMA Style
Assari S, Zare H, Sonnega A. High Education, Low Returns: Financial Literacy Challenges for African Americans and Hispanics. Current Research in Public Health. 2024; 4(6):381-391. https://doi.org/10.31586/ojer.2024.1112 
@Article{crph1112,
AUTHOR = {Assari, Shervin and Zare, Hossein and Sonnega, Amanda},
TITLE = {High Education, Low Returns: Financial Literacy Challenges for African Americans and Hispanics},
JOURNAL = {Current Research in Public Health},
VOLUME = {4},
YEAR = {2024},
NUMBER = {6},
PAGES = {381-391},
URL = {https://www.scipublications.com/journal/index.php/OJER/article/view/1112},
ISSN = {2831-5162},
DOI = {10.31586/ojer.2024.1112},
ABSTRACT = {Background: Education is widely regarded as a key driver of financial literacy, yet racial and ethnic disparities persist. Even among highly educated individuals, African American and Hispanic populations may face challenges in financial literacy, likely due to structural racism and socioeconomic inequalities that diminish the benefits of education. This study examines the relationship between education and financial literacy among African American and Hispanic individuals compared to their White counterparts, focusing on how structural factors contribute to these disparities. Objective: To determine whether highly educated African American and Hispanic individuals exhibit lower financial literacy compared to similarly educated White individuals and to explore the role of structural factors in explaining these disparities. Methods: Data from the 2016 Understanding America Study (UAS) were used to evaluate financial literacy among U.S. adults. The sample was stratified by race/ethnicity (African American, Hispanic, and White) and educational attainment. Financial literacy was assessed using standardized financial knowledge tests. Multivariate regression models were employed to investigate the relationship between race/ethnicity, education, and financial literacy, adjusting for socioeconomic factors such as income, employment, and household wealth. Results: African American and Hispanic individuals with higher levels of education demonstrated significantly lower financial literacy scores than their White peers (p < 0.001). The positive association between education and financial literacy was notably stronger for White individuals than for African American and Hispanic individuals. Further analyses suggest that structural barriers, including systemic discrimination in access to financial resources and disparities in educational quality, contribute to these diminished returns on education for racial and ethnic minorities. Conclusion: This study highlights persistent financial literacy disparities among highly educated African American and Hispanic individuals, underscoring the limitations of education alone in overcoming structural inequalities. The findings emphasize the need for targeted policies to address systemic barriers that restrict the financial knowledge and opportunities typically associated with higher education for racial and ethnic minority groups.},
}
%0 Journal Article
%A Assari, Shervin
%A Zare, Hossein
%A Sonnega, Amanda
%D 2024
%J Current Research in Public Health

%@ 2831-5162
%V 4
%N 6
%P 381-391

%T High Education, Low Returns: Financial Literacy Challenges for African Americans and Hispanics
%M doi:10.31586/ojer.2024.1112
%U https://www.scipublications.com/journal/index.php/OJER/article/view/1112

TY  - JOUR
AU  - Assari, Shervin
AU  - Zare, Hossein
AU  - Sonnega, Amanda
TI  - High Education, Low Returns: Financial Literacy Challenges for African Americans and Hispanics
T2  - Current Research in Public Health
PY  - 2024
VL  - 4
IS  - 6
SN  - 2831-5162
SP  - 381
EP  - 391
UR  - https://www.scipublications.com/journal/index.php/OJER/article/view/1112
AB  - Background: Education is widely regarded as a key driver of financial literacy, yet racial and ethnic disparities persist. Even among highly educated individuals, African American and Hispanic populations may face challenges in financial literacy, likely due to structural racism and socioeconomic inequalities that diminish the benefits of education. This study examines the relationship between education and financial literacy among African American and Hispanic individuals compared to their White counterparts, focusing on how structural factors contribute to these disparities. Objective: To determine whether highly educated African American and Hispanic individuals exhibit lower financial literacy compared to similarly educated White individuals and to explore the role of structural factors in explaining these disparities. Methods: Data from the 2016 Understanding America Study (UAS) were used to evaluate financial literacy among U.S. adults. The sample was stratified by race/ethnicity (African American, Hispanic, and White) and educational attainment. Financial literacy was assessed using standardized financial knowledge tests. Multivariate regression models were employed to investigate the relationship between race/ethnicity, education, and financial literacy, adjusting for socioeconomic factors such as income, employment, and household wealth. Results: African American and Hispanic individuals with higher levels of education demonstrated significantly lower financial literacy scores than their White peers (p < 0.001). The positive association between education and financial literacy was notably stronger for White individuals than for African American and Hispanic individuals. Further analyses suggest that structural barriers, including systemic discrimination in access to financial resources and disparities in educational quality, contribute to these diminished returns on education for racial and ethnic minorities. Conclusion: This study highlights persistent financial literacy disparities among highly educated African American and Hispanic individuals, underscoring the limitations of education alone in overcoming structural inequalities. The findings emphasize the need for targeted policies to address systemic barriers that restrict the financial knowledge and opportunities typically associated with higher education for racial and ethnic minority groups.
DO  - High Education, Low Returns: Financial Literacy Challenges for African Americans and Hispanics
TI  - 10.31586/ojer.2024.1112
ER  -