Does U.S. Household Financial Access Mediate the Relationship Between a Large Income Drop and Credit Record?

Household financial access, in the form of savings, investments, credit, and others, can provide the means to smooth consumption and make on-time payments when large income drops occur. This study examined the model in which household financial access mediated the association between a large income drop and credit record in a national representative sample. Results indicate that household financial access was significantly associated with a large income drop after controlling for financial education, socialization, knowledge, and sociodemographic variables. Results suggest that household financial access may buffer the relationship. Practice and policy implications are included.