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Little is known about the financial health of collegiate athlete. This is surprising for several reasons. First, college students are easily accessible by researchers (Batres et al., 2018). Second, there has been a large focus in research and in popular media on the academic health of student-athletes (e.g. Gayles and Hu, 2009). Finally, there is a rise in media attention around professional athletes and deficits in their financial health (e.g. Dean, 2013; Kuper, 2013; Pagliarini, 2013; Preston, 2013; Torre, 2009). This paper proposes that there is a need for more research focus on the financial well-being of student-athletes to prepare them for life after graduation.
Financial well-being is a state of feeling financially healthy, happy and worry-free resulting from one’s ability to sustain current and future desired living standards (Brüggen et al., 2017; Strömbäck et al., 2017; Malone et al., 2010). Financial well-being is linked to improved academic performance, job satisfaction, physical and mental health, and is a strong predictor of individual happiness, satisfaction and overall well-being in life (Shim et al., 2009; Parish and Cloud, 2006; O’Neill et al., 2005). Financial well-being has been linked to three key areas: financial knowledge, financial self-efficacy and financial stress (Remund, 2010), with the intersection of financial knowledge and financial self-efficacy being a key predictor in how an individual is able to cope with financial stress (Heckman et al., 2014).
Financial knowledge is important in order to be able to manage money properly. However, financial knowledge does not translate directly to financial management (e.g. Klontz et al., 2008; Willis, 2011). Therefore, most researchers have now added the concept of financial self-efficacy into the mix. Financial self-efficacy is the confidence in one’s self to be able to manage one’s finances (Heckman et al., 2014). Financial knowledge and self-efficacy are essential to financial literacy. Remund (2010) states that “financial literacy is a measure of the degree to which one understands key financial concepts and possesses the ability and confidence to manage personal finances through appropriate, short-term decision-making and sound, long-range financial planning, while mindful of life events and changing economic conditions” (p. 284).
Therefore, the purpose of this paper is to investigate the relationship between financial literacy (i.e. financial knowledge and...