Beschreibung:
Despite the increasing prevalence of short-term income shocks (e.g., a temporary pay cut), most financial resilience research examines expense shocks (e.g., car repairs). Here we explore the behavioral consequences of income and expense shocks and propose an intervention to mitigate the psychological toll posed by such shocks. Across three experiments, participants were presented with either a one-time income or a one-time expense shock and answered questions afterward. We found that one-time income shocks evoked more methods of coping, were harder to cope with, more impactful on daily life, and perceived as a greater loss than expense shocks of the same amount. A self-affirmation intervention successfully mitigated some of these deleterious effects. By differentiating income shocks from expense shocks, these findings provide a more nuanced understanding of decision-making during financial shortfalls. This evidence contributes to strategies used to manage financial emergencies and informs public policy to support household financial management