FINANCIAL WELL-BEING OF THE BENEFICIARIES OF THE <i>MINHA CASA MINHA VIDA</i> PROGRAM: PERCEPTION AND ANTECEDENTS

VIEIRA, KELMARA M.; BRESSAN, AURELIANO A.; FRAGA, LUANA S.

doi:10.1590/1678-6971/eRAMG210115

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Human and Social Management • RAM, Rev. Adm. Mackenzie 22 (2) • 2021 • https://doi.org/10.1590/1678-6971/eRAMG210115 copy

FINANCIAL WELL-BEING OF THE BENEFICIARIES OF THE MINHA CASA MINHA VIDA PROGRAM: PERCEPTION AND ANTECEDENTS

Authorship SCIMAGO INSTITUTIONS RANKINGS

ABSTRACT

Purpose:

This article has two main objectives: to measure the level of financial well-being (FWB) of the beneficiaries of the Minha Casa Minha Vida program (PMCMV) and test the hypothesis that financial literacy is an antecedent of the FWB.

Originality/value:

Considering that there is still no universally accepted definition and measure for the FWB (Brüggen, Hogreve, Holmlund, Kabadayi, & Löfgren, 2017Brüggen, E. C., Hogreve, J., Holmlund, M., Kabadayi, S., & Löfgren, M. (2017). Financial well-being: A conceptualization and research agenda. Journal of Business Research, 79, 228-237. doi:10.1016/j.jbusres.2017.03.013
https://doi.org/10.1016/j.jbusres.2017.0... ), this study seeks to apply the methodology proposed by the Consumer Financial Protection Bureau (CFPB) in Brazil, since the previous applications attempts of other scales showed great instability. Also, the hypothesis that the financial literacy is a antecedent of the FWB is tested.

Design/methodology/approach:

To measure the FWB, the scale developed by the CFPB was used. Financial literacy was built from the three dimensions proposed by the Organisation for Economic Co-operation and Development (OECD), which are: financial behavior, attitude and financial knowledge. The instrument was implemented in 561 beneficiaries of the three funding ranges of the PMCMV. It was used for descriptive statistical analysis, confirmatory factorial analysis and multiple linear regression.

Findings:

The results indicated that the majority of the beneficiaries of the program present medium-low and medium-high levels of FWB. The hypothesis that financial literacy is an antecedent of the FWB was confirmed, and all three dimensions had a positive impact. Levels of income also presented a positive influence, whereas the fact of having dependents had a negative impact. The BEF measure proposed by the CFPB seems adequate to the Brazilian context. And advances in the national financial literacy strategies tend to increase the FWB of the Minha Casa Minha Vida program.

KEYWORDS
Financial well-being; Minha Casa Minha Vida program; Financial literacy; Financial protection; Well-being scale

Components	Present	Future
Security	Control over day-to-day finances.	Ability to deal with a financial setback.
Freedom of choice	Freedom in financial choices to enjoy life.	To be on track to achieve your financial goals.

Variable	Expected relationship	Authors
Gender	Men have higher levels of financial well-being.	Shim et al. (2009)Gutter, M., & Copur, Z. (2011). Financial behaviors and financial well-being of college students: Evidence from a national survey. Journal of Family and Economic, 32(4), 699-714. doi:10.1007/s10834-011-9255-2 https://doi.org/10.1007/s10834-011-9255-... , Gutter and Copur (2011)Gutter, M., & Copur, Z. (2011). Financial behaviors and financial well-being of college students: Evidence from a national survey. Journal of Family and Economic, 32(4), 699-714. doi:10.1007/s10834-011-9255-2 https://doi.org/10.1007/s10834-011-9255-... , and Leach, Hayhoe, and Turner (1999)Leach, L. J., Hayhoe, C. R., & Turner, P. R. (1999). Factors affecting perceived economic well-being of college students: A gender perspective. Journal of Financial Counseling and Planning, 10(2), 11-24.
Dependents	Dependents at home negatively influence FWB.	Penn (2007)Penn, D. A. (2007). Financial well-being in an urban area: An application of multiple imputation [Working Paper]. Department of Economics and Finance, Paris. and Kunkel (2014)Kunkel, F. I. R. (2014). Causas e consequências da dívida no cartão de crédito: Uma análise multifatorial (Dissertação de mestrado, Universidade Federal de Santa Maria, Santa Maria, Brasil).
Age	Older individuals have greater financial well-being compared to younger ones.	Sumarwan (1990)Sumarwan, U. (1990). A managerial system approach to factors influencing satisfaction with households’ financial status (Doctoral thesis, Iowa State University, Ames, Iowa, USA)., Xiao, Sorhaindo, and Garman (2006)Xiao, J. J., Sorhaindo, B., & Garman, E. T. (2006). Financial behaviors of consumers in credit counseling. International Journal of Consumer Studies, 30(2), 108-121. doi:10.1111/j.1470-6431.2005.00455.x https://doi.org/10.1111/j.1470-6431.2005... , Plagnol (2011)Plagnol, A. C. (2011). Financial satisfaction over the life course: The influence of assets and liabilities. Journal of Economic Psychology, 32(1), 45-64. doi:10.1016/j.joep.2010.10.006 https://doi.org/10.1016/j.joep.2010.10.0... and Kunkel (2014)Kunkel, F. I. R. (2014). Causas e consequências da dívida no cartão de crédito: Uma análise multifatorial (Dissertação de mestrado, Universidade Federal de Santa Maria, Santa Maria, Brasil).
Marital status	Married individuals have a higher FWB.	Sumarwan (1990)Sumarwan, U. (1990). A managerial system approach to factors influencing satisfaction with households’ financial status (Doctoral thesis, Iowa State University, Ames, Iowa, USA). and Diniz, Vieira, Potrich, and Campara (2014Diniz, A. P. C., Vieira, K. M., Potrich, A. C. G., & Campara, J. P. (2014). Influência das variáveis socioeconômicas e demográficas no bem-estar financeiro: Um estudo do comportamento maranhense. Revista Uniabeu, 7(17), 218-234., 2015)Diniz, A. P. C., Vieira, K. M., Potrich, A. C. G., & Campara, J. P. (2015). Bem-estar financeiro: Uma análise multifatorial do comportamento maranhense. Estudos do CEPE, 42, 186-202. doi:10.17058/cepe.v0i42.6317 https://doi.org/10.17058/cepe.v0i42.6317...
Marital status	Single individuals have higher FWB.	Gutter and Copur (2011)Gutter, M., & Copur, Z. (2011). Financial behaviors and financial well-being of college students: Evidence from a national survey. Journal of Family and Economic, 32(4), 699-714. doi:10.1007/s10834-011-9255-2 https://doi.org/10.1007/s10834-011-9255-...
Education	Individuals with a higher educational level tend to have a higher FWB.	Lown and Ju (1992)Lown, J. M., & Ju, I. S. (1992). A model of credit use and financial satisfaction. Financial Counseling and Planning, 3, 105-125., Diniz, Vieira, Potrich, and Campara (2014Diniz, A. P. C., Vieira, K. M., Potrich, A. C. G., & Campara, J. P. (2014). Influência das variáveis socioeconômicas e demográficas no bem-estar financeiro: Um estudo do comportamento maranhense. Revista Uniabeu, 7(17), 218-234., 2015)Diniz, A. P. C., Vieira, K. M., Potrich, A. C. G., & Campara, J. P. (2015). Bem-estar financeiro: Uma análise multifatorial do comportamento maranhense. Estudos do CEPE, 42, 186-202. doi:10.17058/cepe.v0i42.6317 https://doi.org/10.17058/cepe.v0i42.6317... , and Penn (2007)Penn, D. A. (2007). Financial well-being in an urban area: An application of multiple imputation [Working Paper]. Department of Economics and Finance, Paris.
Education	Individuals with a lower educational level tend to have a higher FWB.	Plagnol (2011)Plagnol, A. C. (2011). Financial satisfaction over the life course: The influence of assets and liabilities. Journal of Economic Psychology, 32(1), 45-64. doi:10.1016/j.joep.2010.10.006 https://doi.org/10.1016/j.joep.2010.10.0...
Income	Individuals with higher income levels have higher FWB.	Sumarwan (1990)Sumarwan, U. (1990). A managerial system approach to factors influencing satisfaction with households’ financial status (Doctoral thesis, Iowa State University, Ames, Iowa, USA)., Delafrooz and Paim (2011)Delafrooz, N., & Paim, L. H. (2011). Determinants of financial wellness among Malaysia workers. African Journal of Business Management, 5(24), 10.092-10.100. doi: 10.5897/AJBM10.1267 https://doi.org/10.5897/AJBM10.1267... , Gutter and Copur (2011)Gutter, M., & Copur, Z. (2011). Financial behaviors and financial well-being of college students: Evidence from a national survey. Journal of Family and Economic, 32(4), 699-714. doi:10.1007/s10834-011-9255-2 https://doi.org/10.1007/s10834-011-9255-... , Penn (2007)Penn, D. A. (2007). Financial well-being in an urban area: An application of multiple imputation [Working Paper]. Department of Economics and Finance, Paris., Kunkel (2014)Kunkel, F. I. R. (2014). Causas e consequências da dívida no cartão de crédito: Uma análise multifatorial (Dissertação de mestrado, Universidade Federal de Santa Maria, Santa Maria, Brasil)., Diniz et al. (2014)Diniz, A. P. C., Vieira, K. M., Potrich, A. C. G., & Campara, J. P. (2014). Influência das variáveis socioeconômicas e demográficas no bem-estar financeiro: Um estudo do comportamento maranhense. Revista Uniabeu, 7(17), 218-234., and Vlaev and Elliott (2014)Vlaev, I., & Elliott, A.(2014). Financial well-being components. Social Indicators Research, 118(3), 1103-1123. doi:10.1007/s11205-013-0462-0 https://doi.org/10.1007/s11205-013-0462-...

Variables	Alternatives	Frequency	Percentage
Age	Up to 29 years	147	26.2
	From 30 to 36 years	144	25.7
	From 37 to 48 years	142	25.3
	Above 48 years	128	22.8
Gender	Male	184	32.8
Gender	Female	377	67.2
Marital status	Married	349	62.3
	Single	138	24.6
	Widowed	24	4.3
	Separated	49	8.8
Has dependents	No	263	47.6
Has dependents	Yes	290	52.4
Education level	I never studied.	7	1.3
	Elementary school from 1st to 4th grade	69	12.4
	Elementary school from 5th to 9th grade	74	13.3
	High school	218	39.1
	Technical course	38	6.8
	Faculty (higher education)	114	20.5
	Specialization or MBA	23	4.1
	Masters/doctorate/postdoctorate	14	2.5
Who works in your family?	You	129	24
	Your partner	61	11.3
	You and your partner	258	48
	Your children/grandchildren	18	3.3
	You, your partner, and your children/grandchildren	18	3.3
	Other people	44	8.2
	Nobody	10	1.9
Who contributes to the household expenses?	You	144	25.9
	Your partner	57	10.3
	You and your partner	272	48.9
	Your children/grandchildren	13	2.3
	You, your partner, and your children/grandchildren	16	2.9
	Other people	51	9.2
	Nobody	3	0.5
Occupation	Wage earner with a formal contract	256	45.7
	Wage earner without a formal contract	7	1.3
	Public agente	55	9.8
	Regular freelance	61	10.9
	Businessman	15	2.7
	Free-lance	20	3.6
	Housewife	35	6.3
	Just retired	44	7.9
	Only student	6	1.1
	Unemployed (looking for a job)	23	4.1
	Unemployed (not looking for a job)	12	2.1
	Another	25	4.5
Monthly family income	Up to R$ 1,600.00	123	22
	From R$ 1,600.01 to R$ 3,275.00	233	41.7
	From R$ 3,275.01 to R$ 5,000.00	147	26.3
	Above R$ 5,000.00	56	10.0

Adjustment indices	Purpose	Limits
Chi-square (value)	- Significance of the differences between the observed matrix (Σ) and the estimated matrix (Σϴ). When the sample is large, it tends to be significant, thus testing Chi-square/degrees of freedom.	Chi-square/degrees of freedom < 3
Chi-square (probability)		Chi-square/degrees of freedom < 3
Goodness of fit (GFI)	- Represents the general degree of adjustment, not being weighted in terms of degrees of freedom.	> 0.95
Comparative fit index (CFI)	- Global comparative measure between the estimated and null models.	> 0.95
Normed fit index (NFI)	- Indicates the proportion in which the adjustment of the proposed model is better than the adjustment of the null model.	> 0.95
Tucker-Lewis index (TLI)	- It presents an interpretation similar to the NFI including an adjustment measure for the complexity of the model.	> 0.95
Root mean square residual (RMSR)	- Compares the fit of two different models made from the same database.	< 0.05
RMS error of approximation (RMSEA)	- Represents the discrepancy between the covariance matrix observed and estimated by the degree of freedom.	< 0.08
Reliability	Purpose	Limits
Reliability index	- Check the internal consistency of an aggregate scale based on the average correlation between the pairs of indicators.	> 0.6
Cronbach's alpha		> 0.6

Variables	Description
Financial behavior	Q140,120+Q160,121+Q170,252+Q180,267+Q19*0,240
Financial attitude	Q23i0,266+Q24i0,231+Q25i*0,503
Financial knowledge	Q28+Q29+Q30+Q31+Q32+Q33+Q34+Q35
Age	Age in years
Income	Total monthly family income in reais
Gender dummy	0 = female; 1 = male
Marital status dummy	0 = single, widowed, separated; 1 = married
Schooling dummy	0 = did not study, elementary school, high school; 1 = higher education or postgraduate
Dependent dummy	0 = has no dependents; 1 = has dependents

Variables	Average (95% conf. interval)	Standard deviation	Percentages
			Completely	Very well	Somewhat	Very little	Not at all
			(1)	(2)	(3)	(4)	(5)
22. You could handle a large unexpected expense.^ Inverted scales.	3.37 (3.26-3.48)	1.35	11.6	15.3	26.4	17.6	29.1
23. You are securing your financial future.^ Inverted scales.	3.33 (3.23-3.44)	1.26	9.3	14.8	33.9	17.1	24.8
24. Because of your financial situation, you feel that you will never have the things you want in life.	3.91 (3.80-4.02)	1.32	9.1	4.5	23.4	12.2	50.8
25.You can enjoy life because of the way you are managing your money.^ Inverted scales.	2.38 (2.29-2.47)	1.08	22.2	36.9	27.4	8.1	5.5
26. You are just surviving financially.	3.15 (3.02-3.29)	1.58	24.1	12.4	20.9	9.7	32.9
27. You are concerned that the money you have or will have saved may not be enough.	2.71 (2.59-2.84)	1.51	32.3	15.2	23.5	8.2	20.9

Variables	Average (95% conf. interval)	Standard deviation	Percentages
			Always	Often	Sometimes	Rarely	Never
			(1)	(2)	(3)	(4)	(5)
28. Giving a wedding, birthday or other gift would put your month's finances in trouble.	3.20 (3.07-3.31)	1.47	21.60	8.00	26.40	17.00	27.00
29.You have money left over at the end of the month.^ Inverted scales.	3.03 (2.93-3.14)	1.29	16.80	14.00	35.40	16.60	17.20
30. You are not up to date with your finances.	3.99 (3.88-4.09)	1.27	6.80	8.20	15.90	17.70	51.30
31. Your finances control your life.	2.93 (2.81-3.06)	1.48	24.00	15.70	28.10	7.50	24.70

Variables	Financial wellbeing	Variables	Financial wellbeing
Variables	Value (significance)	Variables	Value (significance)
Financing range¹ 1 t test;	-9.279 (0.000)	Marital status² 2 ANOVA.	2.977 (0.031)
Gender¹ 1 t test;	5.007 (0.000)	Education² 2 ANOVA.	10.513 (0.000)
Has dependents¹ 1 t test;	5.950 (0.000)	Occupation² 2 ANOVA.	5.386 (0.000)
		Family income² 2 ANOVA.	47.351 (0.000)

Variables			Difference in means	Sig.
Education² 2 Games-Howell post hoc test.	High school	Elementary school 1st to 4th grade	4.532	0.002
	Technical Course	Elementary school 1st to 4th grade	6.183	0.002
	Technical Course	Elementary school 5th to 9th grade	5.315	0.034
	College	Elementary school 1st to 4th grade	8.469	0.000
		Elementary school 5th to 9th grade	7.601	0.000
		High school	3.937	0.000
	Masters/doctorate/ postdoctorate	Elementary School 1st to 4th grade	9.341	0.009
	Masters/doctorate/ postdoctorate	Elementary School 5th to 9th grade	8.473	0.024
Occupation¹ 1 Tukey's post hoc HDS test;	Salaried with a formal contract	Freelancer	7.745	0.004
	Salaried with a formal contract	Housewife	5.316	0.023
	Civil servant	Freelancer	9.654	0.001
		Housewife	7.226	0.004
		Unemployed (looking for a job).	7.245	0.031
		Unemployed (not looking for a job).	9.404	0.023
		Other	7.363	0.018
	Regular self-employed	Free-lancer	9.170	0.002
		Housewife	6.741	0.010
		Other	6.878	0.035
Income² 2 Games-Howell post hoc test.	From R$ 1,600.01 to R$ 3,275.00	Up to R$ 1,600.00	5.093	0.000
	From R$ 3,275.01 to R$ 5,000.00	Up to R$ 1,600.00	8.235	0.000
	From R$ 3,275.01 to R$ 5,000.00	From R $ 1,600.01 to R$ 3,275.00	3.143	0.001
	Above R$ 5,000.00	Up to R$ 1,600.00	13.821	0.000
		From R$ 1,600.01 to R$ 3,275.00	8.729	0.000
		From R$ 3,275.01 to R$ 5,000.00	5.586	0.000

Financial well-being level	Score	Age				Chi-square
		18 to 61		62 or more
		Frequency	Percentage	Frequency	Percentage
Very low	0-29	8	1.6	0	0	Value 4.576 Sig. 0.470
Low	30-37	34	6.7	2	4.8
Medium-low	38-49	134	26.3	16	38.1
Medium-high	50-57	131	25.7	12	28.6
High	58-67	121	23.7	6	14.3
Very high	68-100	82	16.1	6	14.3
Total		510	100.0	42	100.0

Adjustment indices	Financial behavior		Financial attitude
Adjustment indices	Initial model	Final model	Initial model	Final model
Chi-square (value)	244.134	4.388	245.703	2.306
Chi-square (probability)	0	0.356	0	0.129
Degrees of freedom	27	4	20	1
Chi-square/degrees of freedom	9.042	1.097	12.285	2.306
Goodness of fit (GFI)	0.914	0.997	0.894	0.997
Comparative fit index (CFI)	0.907	1	0.521	0.991
Normed fit index (NFI)	0.897	0.998	0.508	0.984
Tucker-Lewis index (TLI)	0.876	1	0.330	0.973
Root mean square residual (RMR)	0.174	0.025	0.154	0.048
R. M. s error of approximation (RMSEA)	0.12	0.013	0.142	0.048
Reliability index	0.787	0.870	0.567	0.584
Cronbach's alpha	0.798	0.859	0.540	0.550

Variables	Standardized coefficients	t-stat	Sig.	VIF
Financial knowledge	0.113	3.375	0.001	1.287
Financial behavior	0.435	12.948	0.000	1.286
Financial atitude	0.245	7.347	0.000	1.264
Age	0.036	1.154	0.249	1.129
Income	0.200	5.627	0.000	1.441
Gender dummy	0.005	0.158	0.874	1.139
Dummy marital status	0.005	0.161	0.872	1.129
Schooling dummy	0.029	0.844	0.399	1.325
Dependent dummy	-0.081	-2.565	0.011	1.152
R ²	0.548
Adjusted R²	0.540
F (sig)	69.457 (0.000)
Kolmogorov Smirnov Z (sig)	0.619 (0.838)
Pesaran-Pesaran	-0.473 (0.637)

Construct	Questions	Scale
Financial well-being	1. I could handle a major unexpected expense.^* * Inverted scales.	Completely, very well, somewhat, very little, not at all
	2. I am securing my financial future.^* * Inverted scales.
	3. Because of my money situation, I feel like I will never have the things I want in life.
	4. I can enjoy life because of the way I'm managing my money.^* * Inverted scales.
	5. I am just getting by financially.
	6. I am concerned that the money I have or will save won't last.
	7. Giving a gift for a wedding, birthday, or other occasion would put a strain on my finances for the month.	Always, often, sometimes, rarely never
	8. I have money left over at the end of the month.^* * Inverted scales.
	9. I am behind in my finances.
	10. My finances control my life.
Financial behavior	11. I take notes and control my personal expenses (e.g., expense and revenue spreadsheet).	Never, almost never, sometimes, almost always, always
	12. I compare prices when buying something.
	13. I have a plan for expenses / budget.
	14. I pay my bills without delay.
	15. I analyze my financial situation before a major purchase.
	16. I save more when I get a pay rise.
	17. I save some of the money I get each month for a future need.
	18. I save monthly.
	19. I save regularly to achieve financial targets in the long term.
Financial attitude	20. It is important to establish financial targets for the future.	Strongly disagree, disagree, indifferent, agree, completely agree
	21. The way I manage my money today will affect my future.
	22. I do not worry about the future, I live only in the present.
	23. Saving is impossible for our family.
	24. After deciding about money, I tend to worry too much about that decision.
	25. It is hard to build a family spending plan
	26. I find it more satisfying to spend money than to save for the future.
	27. Money is made to be spent.

Questions	Options
28. Imagine you have R$ 100.00 in a savings account and the tax rate is 10% a year. After 5 years, how much money will you have in this account?	*More than R$ 150.00.^ * Correct answers in bold.**
	Less than R$ 150.00.
	Exactly R$ 150.00.
	Do not know.
29. Imagine that in 2017 your income will double and the prices of all goods will also double. In 2017, how much will you be able to buy with your income?	More than today.
	*Exactly the same.^ * Correct answers in bold.**
	Less than today.
	Do not know.
30. Considering a long time period, (e.g., 10 years), which asset described below normally gives the highest rate of return?	Savings accounts.
	Public securities.
	*Stocks.^ * Correct answers in bold.**
	Do not know.
31. Imagine five friends receive a donation of R$ 1000.00 and they must split the money equally between them. How much each will get?	100.
	*200.^ * Correct answers in bold.**
	1000.
	5000.
	Do not know.
32. An investment with a high rate of return will have high risk rate. This affirmation is:	*True.^ * Correct answers in bold.**
	False.
	Do not know.
33. A credit lasting 15 years typically requires higher monthly payments than a 30-year credit, but the total interest paid at the end of the loan will be less. This affirmation is:	*True.^ * Correct answers in bold.**
	False.
	Do not know.
34. Imagine you saw the same television at two different stores by the initial price of R$ 1000.00. The A store offers a discount of R$ 150.00, while the B store offers a discount of 10%. What is the best alternative?	*Buy in the A store (discount of R$ 150.00).^ * Correct answers in bold.**
	Buy in the B store (discount of 10%).
	Do not know.
35. Imagine you made a loan of R$ 10000.00 to be paid after one year and the total cost with interest is R$ 600.00. The interest rate you will pay this loan is:	0.3%
	0.6%
	3%
	*6%^ * Correct answers in bold.**

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[1] Correspondence concerning this article should be addressed to Kelmara M. Vieira, Avenida Roraima, 1000, prédio 74C, sala 4212, Camobi, Santa Maria, Rio Grande do Sul, Brazil, CEP 97105-900. E-mail: kelmara@terra.com.br