Life in Perpetual Overdraft: Are Poor Households Doomed to Always be in Debt?

Oshra Costa-Agmon () and Hanna Gendel-Guterman ()
Additional contact information
Oshra Costa-Agmon: Ariel University
Hanna Gendel-Guterman: Ariel University

Journal of Family and Economic Issues, 2025, vol. 46, issue 1, No 20, 319-329

Abstract: Abstract In the last decade, the phenomena of using excessive credit has developed fast. Long-lasting household debt can jeopardize the personal well-being of every member of the household. Most existing research focuses on economic situations to explain the reason that households frequently use overdraft services. The aim of this study is to broaden the scope of the research of the overdraft phenomenon by building a theoretical model which integrates economic factors together with personal psychological traits and external social influence. Qualitative research was used that included in-depth interviews of 29 urban salaried employees. Results showed that economic factors were a significant contributor in explaining overdraft use. Yet social influencing factors, especially the past financial behaviour of the parents and the children’s social demands, were found to have a large effect on the tendency to use overdraft services regularly. Personality traits, mainly locus of control and self-control, added enlightenment to understanding this phenomenon. Through identification of these factors, appropriate preventive steps can be taken by institutions and individuals to reduce the use of surplus credit in ways that lead to harm to the household.

Keywords: Overdraft; Credit; Social economic status; Locus of control; Self-control; Intergenerational transmission (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s10834-024-10013-9 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jfamec:v:46:y:2025:i:1:d:10.1007_s10834-024-10013-9

Ordering information: This journal article can be ordered from
http://www.springer. ... es/journal/10834/PS2

DOI: 10.1007/s10834-024-10013-9

Access Statistics for this article

Journal of Family and Economic Issues is currently edited by Joyce Serido

More articles in Journal of Family and Economic Issues from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().