KU News Service

KU study shows family's wealth can predict math achievement scores

Fri, 11/30/2012

LAWRENCE - Lower levels of wealth in a family may mean lower math scores for their children.

New research from the University of Kansas is showing that wealth - a family's assets minus their liabilities - can predict their children's achievement in math.

Terri Friedline, assistant professor of social welfare at KU, authored a report with Rainier D. Masa and Gina A.N. Chowa of the University of North Carolina highlighting the connection between wealth and math achievement. The Assets and Education Initiative at KU's School of Social Welfare issued the report.

Research has long shown a relationship between a family's economic well-being and their children's academic achievement. However, studies are increasingly considering wealth alongside income as important predictors of academic achievement. Friedline and colleagues established thresholds in wealth levels to take a closer look at how amounts of wealth play a factor.

"We still find that wealth is related to math achievement, but we also see that there are some wealth thresholds that were missed before," Friedline said. "For example, having $10,000 in wealth is not the same as having $2 million in wealth. Previous research hasn't made that distinction."

The researchers analyzed data from the Panel Study of Income Dynamics and scores from the Woodcock Johnson Applied Problems test. They devised a measure known as the inverse hyperbolic sine to deal with great variations in wealth and take account of the unique properties of different kinds of wealth. They also studied wealth categories. For example, they looked at families with zero or negative wealth, in which their assets were less than their debt.

They also categorized low- to moderate-income families, in which their wealth was from zero to $10,000; and families with wealth above $10,000. The researchers also looked at whether having enough wealth to supplement a loss of income related to math achievement.

Not surprisingly, accumulating zero or negative wealth (debt) accurately predicted lower math achievement scores. Those who accumulated moderate levels of positive wealth predicted higher math achievement scores for their children.

A number of other factors influence a child's math achievement, such as their age, gender and educational experiences. But the amount of income a family makes per year did not prove to make a difference.

"Income is not significant here," Friedline said. "It seems to be only wealth that is predicting math achievement. We think wealth gives households and their children the ability to plan for the future in a way that income does not. And when you know that college is a real possibility in the future, that allows you to invest in the present."

In other words, it is not only poor families whose children are performing poorly in math. Families that had good incomes, but also had large amounts of debt, also had lower-math-achieving children. And families that had low to moderate incomes, but were able to accumulate some wealth consistently had children with high math achievement.

National data shows that the aggregate, or national average, of wealth among families is about $58,000, including home values. Among low to moderate income and black households, however, the averages are about $24,000 and $14,000 respectively. With that data in mind, the researchers explored how wealth predicts math achievement among their children. In both cases, accumulating wealth did indeed correlate with higher math achievement. Financial planners often state that families should have enough savings or assets to cover living expenses in the case of losing the primary source of income. Both black and low- to moderate-income households that had enough wealth to meet that criterion also had higher math achievement than those that did not.

The findings, while among the first to consider certain thresholds in wealth and math achievement, reiterate the importance of assets to education. Researchers at the University of Kansas and the Assets and Education Initiative have previously published research showing children with savings accounts are six times more likely to attend college than those who do not. The researchers hope to apply the wealth thresholds to other academic outcomes such as college attendance and graduation in future projects.

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