Abstract
This study aims to check whether the framework of developing financial capacity of adolescents is similar as that of college students, as well as whether adolescence, compared to college age, is the better age for objective financial knowledge to trigger the positive cycle of developing financial capacity. Using a convenience sample of 967 adolescent students from five Hong Kong secondary schools, this study conducted structural equation modeling to evaluate the development of financial capacity. Both subjective and objective financial knowledge in adolescents can be internalized into financial self-beliefs. Subsequently, these self-beliefs influence their financial behavior. The effect of objective financial knowledge on the financial self-beliefs, which is weak for college students, was much stronger for adolescents. The framework of developing financial capacity of adolescents is similar as that of college students. Adolescence, compared to college age, is the better age for objective financial knowledge to trigger the positive cycle of developing financial capacity.