The Impact of Money Attitudes on the Relationship Between Income and Financial Satisfaction
Languages of publication
Prior research has showed that the subjective perception of objective wealth might be affected by various individual difference variables, such as one’s love of money, level of desires, or materialistic inclinations. This paper examines an impact of attitudes towards money on the relation between personal net income and household income, and its subjective evaluation, measured as financial satisfaction and subjective economic well-being. The results of two studies revealed that the affective dimension of money attitudes (assigning the symbolic meaning to money) partially mediated the relationship between income and financial satisfaction. Moreover, the instrumental dimension of attitude towards money (individuals’ attitude toward money management) moderated this relationship: The relationship between the two was stronger for individuals highly concentrated on money management than for those with low scores on this factor.
- Belk, R.W. (1985). Materialism: trait aspects of living in the material world. Journal of Consumer Research, 12, 265-280.[Crossref]
- Belk, R.W., & Wallendorf, M. (1990). The sacred meanings of money. Journal of Economic Psychology, 11, 35-68.[Crossref]
- Chaplin, L.N., & & John, D.R. (2007). Growing up in a material world: Age differences in materialism in children and adolescents. Journal of Consumer Research, 34, 480-493.[Crossref]
- Clark, A.E., & Oswald, A.J. (1996). Satisfaction and comparison income. Journal of Public Economics, 61(3), 359-381.[Crossref]
- Danes, S.M, & Rettig, K.D. (1993). The roles of perception in the intention to change the family financial situation. Journal of Family and Economic Issues, 14, 365-389.
- Diener, E., & Biswas-Diener, R. (2009). Will money increase subjective well-being?: A literature review and guide to needed research. Social Indicators Research, 37, 119-154.
- Diener, E., Diener, M., & Diener, C. (1995). Factors predicting the subjective well-being of nations. Journal of Personality and Social Psychology, 69, 851-864.[Crossref]
- Dowling, N.A., Corney, T., & Hoiles, L. (2009). Financial management practices and money attitudes as determinants of financial problems and dissatisfaction in young male Australian workers. Journal of Financial Counseling and Planning, 20, 5-13.
- Freeman, C., Carlson, J., & Sperry, L. (1993). Adlerian marital therapy strategies with middle income couples facing financial stress. American Journal of Family Therapy, 21, 324-332.[Crossref]
- Furnham, A. (1984) Many sides to the coin: The psychology of money usage. Personality and Individual Differences, 5, 501-509.[Crossref]
- Furnham, A., & Argyle, M. (1998). Psychology of money. London: Routledge.
- Furnham, A., Wilson, E., & Telford, K. (2012). The meaning of money: The validation of a short money-types measure. Personality and Individual Differences, 52, 707-711.[Crossref]
- Gardarsdottir, R.B., & Dittmar, H. (2012). The relationship of materialism to debt and financial well-being: The case of Iceland’s perceived prosperity. Journal of Economic Psychology, 33, 471-481.[Crossref]
- Gardner, D.G., Van Dyne, L., & Pierce, J.L. (2004). The effects of pay level on organization-based self-esteem and performance: A field study. Journal of Occupational and Organizational Psychology, 77, 307-322.[Crossref]
- Garman, E.T., Leech, I.E., & Grable, J.E. (1996). The negative impact of employee poor personal financial behaviors on employers. Financial Counseling and Planning, 7, 157-168.
- Gasiorowska, A. (2013). Skrócona wersja Skali Postaw Wobec Pieniędzy SPP-25. Dobór pozycji i walidacja narzędzia [Short version of Money Attitudes Questionnaire. Item selection and scale validation]. (in Polish). Psychologia Społeczna, 8, 459-478.
- Gasiorowska, A. (2014a). Psychologiczne znaczenie pieniędzy. Dlaczego pieniądze powodują koncentrację na sobie [Psychological meaning of money. Why money induces self-focus] (in Polish). Warsaw: Wydawnictwo Naukowe PWN S.A.
- Gasiorowska, A. (2014b). The Relationship Between Objective and Subjective Wealth is Moderated by Financial Control and Mediated by Money Anxiety. Journal of Economic Psychology, 43, 64-74.[Crossref]
- Gasiorowska, A., & Helka, A. (2012). Psychological consequences of money and money attitudes in dictator game. Polish Psychological Bulletin, 43, 20-26.
- Goldsmith, A. H., Veum, J. R., & Darity, W. (1997). The impact of psychological and human capital on wages. Economic Inquiry, 35, 815-829.[Crossref]
- Hayes, A.F. (2013). Introduction to mediation, moderation, and conditional process analysis. A regression-based approach. New York, NY: The Guilford Press.
- Hayhoe, C. R., Leach, L., & Turner, P. R. (1999). Discriminating the number of credit cards held by college students using credit and money attitudes. Journal of Economic Psychology, 20, 643-656.[Crossref]
- Hayhoe, C.R., & Wilhelm, M.S. (1998). Modeling perceived economic well-being in a family setting: A gender perspective. Financial Counseling and Planning, 9, 21-34.
- Hayhoe, C.R., Cho, S.H., DeVaney, S.A., Worthy, S.L., Kim, J., & Gorham, E. (2012). How do distrust and anxiety affect saving behavior? Family and Consumer Sciences Research Journal, 41(1), 69-85.
- Hayo, B., & Seifert, W. (2002). Subjective economic well-being in Eastern Europe. Journal of Economic Psychology, 24, 329-348.
- Joo, S., & Garman, E. T. (1998). The relationship between personal financial wellness and employee productivity: A conceptual model. Personal Finances and Worker Productivity, 2, 162-171.
- Joo, S., & Grable, J.E. (2004). An exploratory framework of the determinants of financial satisfaction. Journal of Family and Economic Issues, 25, 25-50.
- Kim, J. (1999). Financial satisfaction, personal finance-work conflict, and work outcomes: Pay satisfaction, organizational commitment, and productivity. Proceedings of the Association for Financial Counseling and Planning Education, 16, 38-45.
- Kim, J., & Garman, E. T. (2003). Financial stress and absenteeism: An empirically derived model. Financial Counseling and Planning, 14, 31-42.
- Lea, S.E.G., & Webley, P. (2006). Money as tool, money as drug: The biological psychology of a strong incentive. Behavioral and Brain Sciences, 29, 161-209.
- Lim, V.K.G., Teo, T.S.H, & Loo, G.L. (2003). Sex, financial hardship and locus of control: an empirical study of attitudes towards money among Singaporean Chinese.
- Mills, R.J., Grasmick, H.G., Morgan, C.S., & Wenk, D. (1992). The effects of gender, family satisfaction, and economic strain on psychological well-being. Family Relations, 41, 440-446.[Crossref]
- O’Neill, B., Sorhaindo, B., Xiao, J.J., & Garman, E.T. (2005). Financially distressed consumers: Their financial practices, financial well-being, and health. Financial Counseling and Planning, 16, 73-87.
- Pravitz, A.D., Garman, E.T., Sorhaindo, B., O’Neill, B., Kim, J., & Drentea, P. (2006). InCharge Financial Distress/Financial Well-Being Scale: Development, administration, and score interpretation. Financial Counseling and Planning, 17, 34-50.
- Preacher, K. J., Rucker, D. D., & Hayes, A. F. (2007). Addressing moderated mediation hypotheses: Theory, methods, and prescriptions. Multivariate Behavioral Research, 42, 185-227.[Crossref]
- Richins, M.L. (1994). Special possessions and the expression of material values. Journal of Consumer Research, 21, 522-533.[Crossref]
- Richins, M.L., & Dawson, S. (1992). A consumer values orientation for materialism and its measurement: Scale development and validation. Journal of Consumer Research, 19, 303-316.[Crossref]
- Shafer, A.B. (2000). Mediation of the Big Five’s effect on career decision making by the life task dimensions and on the money attitudes by materialism, Personality and Individual Differences, 28, 93-109.[Crossref]
- Sohn, S.H., Joo, S.H., Grable, J.E., Lee, S., & Kim, M. (2012). Adolescents’ financial literacy: The role of financial socialization agents, financial experiences, and money attitudes in shaping financial literacy among South Korean youth. Journal of Adolescence, 35, 969-980.[Crossref]
- Solberg, E.C., Diener, E., Wirtz, D., Lucas, R.E., & Oishi, S. (2002). Wanting, having, and satisfaction: examining the role of desire discrepancies in satisfaction with income. Journal of Personality and Social Psychology, 83, 725-734.[Crossref]
- Tang, T.L.P. (1995). The development of a short money ethic scale: attitudes toward money and pay satisfaction revisited. Personality and Individual Differences, 19, 809-816.[Crossref]
- Tang, T.L.P., & Chiu, R.K. (2003). Income, money ethic, pay satisfaction, commitment, and unethical behavior: Is the love of money the root of evil for Hong Kong employees? Journal of Business Ethics, 46, 13-30.[Crossref]
- Tang, T.L.P., Luna-Arocas R., & Sutarso T. (2005). From income to pay satisfaction: The love of money and pay equity comparison as mediators and culture (the United States and Spain) and gender as moderators. Management Research: The Journal of the Iberoamerican Academy of Management, 3, 7 - 26.
- Tang, T.L.P., Luna-Arocas R., Sutarso T., & Tang D.S.H. (2004). Does the love of money moderate and mediate the income-pay satisfaction relationship? Journal of Managerial Psychology, 19, 111-135.[Crossref]
- Tang, T.L.P., Luna-Arocas, R., Quintanilla Pardo, I., & Tang, T.L.N. (2013). Materialism and the bright and dark sides of the financial dream in Spain: The positive role of money attitudes-the Matthew effect. Applied Psychology: An International Review. doi: 10.1111/j.1464-0597.2012.00533.x [Crossref]
- Tang, T.L.P., Tang, T.L.N., & Homaifar, B.Y. (2006). Income, the love of money, pay comparison, and pay satisfaction: Race and gender as moderators. Journal of Managerial Psychology, 21, 476-491.[Crossref]
- Van Raij, W.F. (1981). Economic psychology. Journal of Economic Psychology, 1, 1-24.[Crossref]
- Vohs, K. D., Mead, N. L., & Goode, M. R. (2006). The psychological consequences of money. Science, 314, 1154-1156.[Crossref][PubMed]
- Von Stumm, S., O’Creevy M.F., & Furnham, A. (2013). Financial capability, money attitudes and socioeconomic status: Risks for experiencing adverse financial events. Personality and Individual Differences, 54, 344-349.[Crossref]
- Walson, C. O., & Fitzsimmons, V. S. (1993). Financial managers’ perception of rural household economic well-being: Development and testing of a composite measure. Journal of Family and Economic Issues, 14, 193-214.
- Wilhelm, M.S., Varcoe, K., & Huebner Fridrich, A. (1993). Financial satisfaction and assessment of financial progress: Importance of money attitudes. Financial Counseling and Planning, 4, 181-199.
- Williams, F.L., Haldeman, V., & Cramer, S. (1996). Financial concerns and productivity. Financial Counseling and Planning, 7, 147-155.
- Yamauchi, K., & Templer, D. (1982). The development of a money attitudes scale. Journal of Personality Assessment, 46, 522-528.[Crossref]
- Zaleskiewicz, T., Gasiorowska, A., Kesebir, P., Luszczynska, A., & Pyszczynski, T. (2013). Money and the fear of death: The symbolic power of money as an existential anxiety buffer. Journal of Economic Psychology, 36, 55-67. [Crossref]
Publication order reference