Gianpaolo Parise, Kim Peijnenburg, 03 May 2017

Cognitive skills are often considered the key to financial wellbeing. Less weight is put on noncognitive skills. This column shows how a lack of conscientiousness, stress resistance, non-impulsiveness, or grit can explain economic fragility in households. When members possess these noncognitive skills, the household is more likely to save, less likely to have excessive unsecured debt, and less likely to be in financial distress.

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