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2022 Annual Conference

May 19–21, 2022

Sheraton Sand Key, Clearwater Beach, FL, US

Proposal authors can use this tool to see where they have been placed in the program agenda for an Oral or Poster Session.

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Confirm your place in the schedule by going to the ACCI Presenter Confirm Google Sheet and marking your session with the name and email address of the author who will be attending and presenting. Each presentation must have a separate paid registraint. Contact the ACCI Office immedicately by email at admin@consumerinterests.org to report a conflict or if you have questions. Please be sure to reference the session title(s), date(s), and time(s) if you contact us.

D2a Financial Capability and Informal Bankruptcy: Comparing Student Loan Holders and Non-holders

Thursday, May 19, 2022 at 3:30 PM–5:00 PM EDT
Room 1
Key Words

bankruptcy, financial capability, insolvency, student loan

Short Description

Student loans are distinctively different from other types of debt. These loans are usually borrowed for education purposes. If borrowed for self or spouse’s education, the loan is essentially an investment in their own human capital and social capital, with the expectation that such investment would bring monetary returns to the family through differentials in future earnings and financial decision-making. Nevertheless, if the student loan is borrowed for others' education, this loan is essentially not different from other tyeps of debt in that the beneficiary's education does not improve the family's future earnings or financial capabilities. Completing the education funded by the student loan also makes a difference in the family's balance sheet in that the current education level may or may not be related to the student loan that was intended to bring returns from such an investement. Recognizing these differences, this study uses the 2016 and 2019 Survey of Consumer Finances to examine the association between financial capability and insolvency, an informal bankruptcy, among both tyoes of student loan holders and non-holders. Results show that financial capability has mixed relationships with insolvency among three subsamples. Findings provide policy and practical implications. 

Submitter

Rui Yao, University of Missouri

Authors

Rui Yao, University of Missouri
JingJian Xiao, University of Rhode Island
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