Advanced SearchSearch Tips
Effects of Keeping Financial Records on Financial Soundness of Households
facebook(new window)  Pirnt(new window) E-mail(new window) Excel Download
 Title & Authors
Effects of Keeping Financial Records on Financial Soundness of Households
Son, Jiyeon; Park, Jooyung;
  PDF(new window)
The Purpose of this study is to find the levels of keeping financial records among Korean households and to reveal the effect of keeping financial records on financial soundness of households. The 2014 Consumer Empowerment Index of the Korean consumer agency, which includes the surveyed results of 1,000 individuals, was analyzed as a secondary dataset. As a result, the following findings emerged during the study. First, 25.9% of consumers replied that they were keeping financial records. Factors associated with keeping financial records were gender and income. Women were more likely to keep financial records than men. Also, income had significant effects on keeping financial records. Second, levels of meeting percentages of financial ratios were highest in the debt to income ratio, which was 81.5%, and lowest in the investment ratio, which was 14.5%. Furthermore, 52.6% met the savings ratio, 40.6% met the emergency funds ratio, 24.6% met the retirement savings ratio. Meeting a percentage of the savings ratio did not fluctuated for 16 years, although the debt to income ratio has decreased around 15% since 1998. Third, keeping a household account book had signigicant influences on meeting percentages of financial ratios. Magnitudes of effects ranged between 1.4-1.8 odds, which were as much as the income effects. In summary, effects of keeping financial records were evidenced in this study. It is suggested that the importance of keeping financial records should be stressed in financial education and counseling programs.
Effect of keeping financial records;Households` financial ratios;financial soundness;
 Cited by
Ahn, C. H., & Joung, S. H. (2006). Articles: The effects of personal financial education on the financial behaviors and objective economic well-being. Journal of Consumer Studies, 17(2), 197-219.

Bae, H. S., & Choe, H. C. (1996). Financial practices and financial satisfaction among rural housewives by family life cycle - Focusing on cash management practices, providing practices for children's educational expenditure, and preparing practice for elderly life. Journal of Korean Home Management Association, 14(3), 167-179.

Cha, K. W. (2007). Financial management patterns and financial knowledge of college students. Journal of Korean Family Resource Management Association, 11(1), 1-20.

Chae, E. S., & Sung, Y. A. (2000). An analysis of the effect of the objective debt burden variables on the subjective debt burden for setting the guidelines for household debt management. Family and Environment Research, 38(11), 1-12.

Cho, D. -P., Yang, S. -J., & Bae, M. (2007). Effects of financial knowledge and financial management on objective financial well-being and subjective financial satisfaction. Korean Journal of Human Ecology, 16(2), 333-348. crossref(new window)

Choe, H. (2001). Investigation of the critical level of household debt burden using intertemporal resource allocation behavior. Journal of Korean Home Management Association, 19(5), 279-291.

Choe, H. C., Lee, H. S., Yang, S. J., & Sung, Y. A. (2003). Development of the indexes and guidelines for evaluating financial status of the household using financial ratios. Journal of Consumer Studies, 14(1), 99-121.

Choe, H., Sung, Y. -A., Joo, S. -H., & Cha, K. -W. (2013). Financial status of korean middle class household based on income-expenditure statement and asset- liability statement. Financial Planning Review, 5(2), 87-116.

Choi, Y. -J., & Choe, H. (1998). Factors affecting financial status of the rural middle-aged and old-aged Households. The Korean Journal of Community Living Science, 9(1), 43-54.

Christian Home Editorial Department. (1980). Consciousness structure regarding household account book. Christian Home, 124-128.

Deacon, R. E., & Firebaugh, F. M. (1988). Family resource management: Principles and application (2nd ed.). Boston: Allyn & Bacon Inc.

FPSB Korea. (2015). Introduction to financial planning. Seoul: FPSB Korea.

Godwin, D. D., & Koonce, J. C. (1992). Cash flow management of low income newlyweds. Financial Counseling and Planning, vol.3, 1-43.

Godwin, D. D. (1994). Antecedents and consequences of newlyweds' cash flow management. Financial Counseling and Planning, vol.5, 161-190.

Griffith, R. (1985). Personal financial statement analysis: A modest beginning. Proceedings, Third Annual Conference of the Association of Financial Counseling and Planning Education, 3, 123-131.

Huh, K. O., & Han, S. J. (2005). Households' financial status estimation with financial ratios. Korean Journal of Human Ecology, 14(4), 613-629.

Im, J. -B., Cho, M. -W., & Lee, Y. -H. (1998). The financial management behavior and financial satisfaction of urban households. Journal of Korean Home Management Association, 16(3), 141-153.

Jeong, M. -S., Kye, S. -J., & Kang, H. -K. (2008). The difference between financial stability and satisfaction according to change-orientation of urban housewives' family financial management behavior. Journal of Korean Home Management Association, 26(5), 391-403.

Jeong, S. L., & Jang, Y. O. (2007). The differences in wives' financial management behavior according to variables related employment and income, and perceived economic instability. Family and Environment Research, 45(10), 59-71.

Jeong, W. -Y., & Hwang, D. -S. (2002). Financial management behavior and financial solidity of urban households. Family and Environment Research, 40(2), 115-130.

Jeong, Y., Yu, J. -Y., Han, W. -K., Han, K. -S., & Oh, Y.-C. (2011). Consumption pattern analysis using the account book application. Korean Institute of Information Scientists and Engineers Proceedings, 38(2), 50-53.

Kim, H. (2000). A study on the financial management behavior and financial satisfaction of housewives in Pusan and Kyugnam region based on the systems approach. Journal of Korean Home Management Association, 18(1), 53-66.

Kim, K. -J., Park, M. -S., & Jeong, W. -Y. (2002). The effects of household financial condition and management behavior performance on the financial satisfaction. Journal of Korean Home Management Association, 20(2), 21-28.

Kim, S. M. (1993). Assessing the relations between financial statements, financial management and financial satisfaction of urban households: Based on the system theory. Journal of Korean Home Management Association, 11(2), 195-207.

Kim, S. -M. (2014). Financial soundness and retirement preparation of korean households. Journal of Korean Family Resource Management Association, 18(4), 27-52.

Kwon, H. (2015, December 16). "Household account book is best written by hand?" continued trend of increase in household account book purchase. Yonhapnews. Retrieved from

Kye, S. J., & Jeong, M. S. (2007). The financial stability and satisfaction urban housewives' family financial management behavior. Journal of Korean Family Resource Management Association, 11(3), 123-144.

Lee, S. (2014). Effect of keeping a household account book on economic life of japanese in their 20s to 30s in a single-family household - using an internet survey of household account books. Journal of Korean Family Resource Management Association, 18(1), 115-140.

Lee, S. -R. (2013). The consumption control policy and the politics of everyday life of consumer culture in the 1970s. Critical Studies on Modern Korean History, 29, 137-182.

Macromill-Embrain. (2014). Household account book and price research. Macromill Embrain.

Macromill-Embrain Contents Operation Division. (2015). Trend monitor 2015. Seoul: Knowledge Nomad.

Min, Y. -K., & Lee, M. -S. (2014). A study on the determinants of the elderly poverty rate of welfare state: focused on 23 OECD countries. Journal of Governance Studies, 9(2), 91-115. crossref(new window)

Ok, K. -Y., & Park, J. -Y. (2013). An analysis of university students' attitude toward life-cycle financial planning. Journal of Happiness and Affluence Studies, 2(2), 47-59.

Park, M. H., Lee, S. S., & Bae, M. K. (1998). Household financial management software development(2). Family and Environment Research, 36(2), 131-144.

Sakamoto, K., & Omogawa, J. (2012). A study on keeping households' account book in the field of family resource management. In Single person households among young adults and households' account book: Insights from Internet survey. Policy Research Paper, 4-13. Household Management Institute.

Seo, I. -J. (2012). A study on cognition of credit card and shopping value based on the consumption orientation. Journal of Korean Home Management Association, 30(3), 105-118.

Shin, H., & Hong, E. (2012). Exploration of the effect of urban households' financial status, financial communication and financial stress on financial satisfaction. 2012 Korean Society of Consumer Studies Fall Conference, 445-449.

Son, J. -Y., & Lee, K. -A. (2014). Consumer empowerment index of Korea. Policy Research Paper, 14-02, Korea Consumer Agency.

Sung, Y. A. (2010). Determinants of household debt holding of different purposes. Journal of Consumer Studies, 21(3), 29-52.

Sung, Y. A. (2016). Use of household ledger and its effect. Financial Planning Review, 9(1), 23-42.

Sung, Y. A., Yang, S. J., Lee, H. S., & Choe, H. C. (2004). Analyzing households using the indexes for evaluating financial status developed based on the financial ratios. Journal of Consumer Studies, 15(3), 155-171.

Yang, S. -J., Joo, S. -H., Cha, K. -W., & Kim, M. (2013). A study of financial ratios guidelines for Korean households. Financial Planning Review, 6(3), 143-181.

Yang, J. (1997). Analysis of Household's Financial Statement. Unpublished doctoral dissertation. Ewha Women's University.

Yoo, K. W. (2010). The impact of education expenditure on household saving and consumption behaviors in Korea. Journal of Consumer Studies, 21(4), 135-160.

Yoon, S. (2016). Rich account book: Easiest investment technique to save money by using. Seoul: Wisdomhouse.

Yuh, Y. K. (2003). Determinants of households' investment assets. Consumption Culture Study, 6(1), 1-17. crossref(new window)