Development of a Personal Financial Management Program for Korean Households

Effects of Financial Knowledge and Financial Management

on Objective and Subjective Financial Satisfaction


Cho and Se-Jeong Yang, SangmyungUniversity


study examines the relationships among financial knowledge, financial
management, and objective and subjective financial satisfaction. For the purpose
of the study, measurement scale for financial knowledge was developed, which
included 20 questions on income, tax, expenditure, credit, savings, insurance,
etc. For measurement of financial management, composite scale was adopted using
20 questions. Subjective financial satisfaction was obtained by average of
satisfaction on six financial categories such as income, expenditure, savings,
insurance and emergency funds, debts, and retirement plan. Objective financial
satisfaction was the number meeting the standards on 7 financial ratios, such
as expenditure/income, financial assets/expenditure, debts/assets, monthly debt
payment/income, investment assets/assets, monthly insurance/income, and
financial assets/assets.