Financial Literacy and 401(k) Loans
Open accessAbstract
Based on a survey of nearly 900 401(k) participants, we find that borrowing in 401(k) plans is related not only to standard demographic factors, but also to measures of general financial literacy, 401(k) contribution rates and wealth, non-retirement wealth, and credit card repayment behavior. Taken together, these results suggest that the decision to borrow from a 401(k) plan is linked to a broader impatience in financial decision-making, namely high discount rates in time preferences. Meanwhile, conditional on loan-taking, financial literacy appears unrelated to whether a given loan is used for consumption or investment purposes. Given the interrelated nature of these borrowing and behaviors, efforts to educate participants about the benefits and risks of 401(k) borrowing may need to be more comprehensive in scope than previously realized.
Integrity signals
Registry
Cites
Statistics
Claims the paper makes
Claims other papers make about this one
Each is checked against this paper’s own text: does it say what the citing paper says it does?
The least literate were more likely to borrow against their 401(k) and pension accounts.
“and Utkus and Young (2011) concluded that the least literate were more likely to borrow against their 401(k) and pension accounts.”
From Financial literacy and the need for financial education: evidence and implications (2019) · cites this paper as Utkus and Young (2011)
Cited by
Sorted by citations
The Economic Importance of Financial Literacy: Theory and Evidence
Lusardi, A., & Mitchell, O. S. (2014) · Journal of Economic Literature · doi:10.1257/jel.52.1.5 · Cited by 4,698 · see citing works
Financial literacy and the need for financial education: evidence and implications
Lusardi, A. (2019) · Swiss Journal of Economics and Statistics · doi:10.1186/s41937-019-0027-5 · Cited by 1,135 · see citing works
The Outlook for Financial Literacy
Lusardi, A., & Mitchell, O. (2011) · doi:10.3386/w17077 · Cited by 125 · see citing works
- Authors
- Utkus, S. P., & Young, J. A.
- ORCID
- Utkus, Stephen P.
- Venue
- Financial Literacy: Implications for Retirement Security and the Financial Marketplace
- Publisher
- Oxford University Press
- Published
- 2011-10-27
- Pages
- 59-75
- OpenAlex
- W4231683308
- Cited by
- 29
- References
- 0
- Citations by year
- 2026: 1 · 2025: 2 · 2024: 1 · 2023: 2 · 2022: 1 · 2021: 1 · 2020: 2 · 2019: 3 · 2018: 1 · 2017: 2 · 2016: 3 · 2015: 1 · 2014: 1 · 2013: 2
- FWCI
- 23.14
- Type
- book chapter
- Language
- en
- Open access
- green
- doi.org
- Locations
- Oxford University Press eBooks (publishedVersion)
- SSRN Electronic Journal (acceptedVersion)
- ScholarlyCommons (University of Pennsylvania) (submittedVersion)
- Topics
- Social Sciences › Business, Management and Accounting › Accounting › Financial Literacy, Pension, Retirement Analysis
- Social Sciences › Business, Management and Accounting › Accounting › Financial Literacy and Behavior
- Social Sciences › Decision Sciences › General Decision Sciences › Decision-Making and Behavioral Economics
- Keywords
- financial literacy, retirement savings, time preference, discount rate, financial education
About these checks
Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.
Statistics and arithmetic are recomputed, not judged.
Confidence bands are shown only for fields calibrated on our annotated test set. None is calibrated yet, so no band is shown.
What counts as a claim ›How we measure confidence ›How we check this ›
Are you an author, or do you see a problem with this page? Request a review
