ArticlePDF Available

Behavior Change for Low-Income Individuals Resulting From a Cooperative Extension Financial Capability Program

Authors:

Abstract

An evaluation was implemented over a 3-year period to assess a statewide financial capability program for low-income, diverse clientele in Michigan. Pre- and post- program evaluation data was used to determine knowledge gain and intended behavior change. Follow-up evaluation data confirmed behavior changes across 10 financial practices. Using the Transtheoretical Model of Behavior Change, research findings revealed participants were better able to maintain change in key financial practices including making wise money decisions, creating a spending plan, and managing debt as a result of the educational program. Recommendations are provided to support future programs with similar clientele.
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 231 — #1
Behavior
ID:ti0005
Change for Low-Income Individuals Resulting
From a Cooperative Extension Financial Capability
Program
Erica
ID:p0050
Tobe,aCheryl Eschbach,bRobert Weber,cJinnifer Ortquist,dand William V. Hendriane
An
ID:p0080
evaluation was implemented over a 3-year period to assess a statewide financial capability program for
low-income, diverse clientele in Michigan. Pre- and post- program evaluation data was used to determine
knowledge gain and intended behavior change. Follow-up evaluation data confirmed behavior changes across
10 financial practices. Using the Transtheoretical Model of Behavior Change, research findings revealed
participants were better able to maintain change in key financial practices including making wise money
decisions, creating a spending plan, and managing debt as a result of the educational program.
Recommendations are provided to support future programs with similar clientele.
Keywords:
ID:ti0010
behavioral
ID:p0085
finance, financial capability, low-income, personal finance, Transtheoretical Model of
Behavior Change
As the nation recovered from the Great Reces-
sion, low-income households continued to strug-
gle (Haskins, 2015). The recession demonstrated
the need for consumers to take greater responsibility in
achieving financial success (Xiao & O’Neill, 2016), and
consumers were asked to make positive choices. How-
ever, this may be difficult. According to the Neigh-
borWorks Consumer Finance Survey (2015), roughly
one-third of adults studied report no emergency savings,
with approximately half indicating their savings would
only last 3 months or less. The Financial Industry Reg-
ulatory Authority (FINRA) National Financial Capabil-
ity study (2015) tells a similar story with half of all
Michigan residents surveyed lacking an emergency fund.
Despite this negative trend, the national and state unem-
ployment rates continued to improve. In April 2018, both
Michigan and the United States reported unemployment
rates of 4.7% and 3.9%, respectively, in comparison to an
October 2009 U.S. unemployment rate of 10% (U.S. Bureau
of Labor Statistics, n.d.a), and the Michigan unemploy-
ment rate of 14.6% (June 2009) (U.S Bureau of Labor
Statistics, n.d.b). Households continue to struggle finan-
cially, even when the economy moves from recession to
recovery.
Cooperative
ID:p0095
Extension’s community-based education pro-
grams have historically brought university knowledge and
resources to local communities. Since the 1980s, Michigan
State University (MSU) Extension has delivered financial
education. In 2011, MSU Extension began implementing
Dollar Works 2, a research informed curriculum (University
of Minnesota Extension, n.d.), designed to strengthen finan-
cial management and decision-making skills (Anderson-
Porisch et al., 2007) by focusing on decision-making,
spending plans, saving, and credit. Although not devel-
oped solely for low-income audiences, an evaluation with
a
ID:p0055
Children & Youth Institute Director, Michigan State University, 446 W. Circle Dr., Room 160 Morrill Hall of Agriculture, East Lansing, MI 48824. E-mail:
tobee@msu.edu
b
ID:p0060
Health and Nutrition Institute Director, Michigan State University, 446 W. Circle Dr., Room 160 Morrill Hall of Agriculture, East Lansing, MI 48824.
E-mail: cheryl@msu.edu
c
ID:p0065
Foreclosure and Homeownership Educator, Michigan State University, 21885 Dunham Road, Suite 12, Clinton Township, MI 48036. E-mail:
weberro2@msu.edu
d
ID:p0070
Money Management Education, Michigan State University, 775 Ball Ave, NE, Grand Rapids, MI 49503. E-mail: ortquisj@msu.edu
e
ID:p0075
District 8 Director, Michigan State University, 50 E. Sprague Rd., Ionia, MI 48846. E-mail: hendria2@msu.edu
Pdf_Folio:231
Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021, 231-241 231
© 2021 Association for Financial Counseling and Planning Education®
http://dx.doi.org/10.1891/JFCP-19-00020
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 232 — #2
low-income participants found the material effective when
offered over a 6-hour period (Bauer et al., 2011).
Selected
ID:p0100
units were implemented in Michigan during
face-to-face, 6-hour money management classes. Sessions
were held in accessible, community-based locations and
recruitment included local partner referrals and online/flyer
promotional marketing. Although the curriculum has an
evaluation, since the entire program was not used, pre-
and post- survey questions were adapted from the National
Endowment for Financial Education (NEFE, 2019) eval-
uation toolkit. This current study is unique in that a the-
oretical framework of behavioral change was translated
into a measurement strategy to examine outcomes reported
by participants—before, after, and in a follow-up—who
attended a financial capability program. The data reflects
programs implemented by Cooperative Extension staff
across one state and uses several years of data to create a
larger sample to study financial behaviors of individuals in
limited resource households.
Guiding Theory
The
ID:p0105
Transtheoretical Model (TTM) of Behavior Change
informed the design of this study, which posits that change
is an intentional process that transforms an individual’s
undesirable behaviors toward healthy actions (Prochaska
et al., 1992). Widely used in the health field, Prochaska
et al. (1992) defined five stages of change: precontempla-
tion (no intention to change, unaware of problem), contem-
plation (aware of problem, not taking action), preparation
(intend to take action in future), action (modifying behav-
iors), and maintenance (maintaining modified behavior).
According to Prochaska et al. (1996), this model integrates
various theories, has clear delineated stages, appropriately
links intervention approaches, and includes self-discipline.
Xiao (2008) noted several Cooperative Extension studies
that have applied TTM to financial education implementa-
tion successfully (Loibl & Hira, 2007; Xiao et al., 2004).
Additionally, researchers have u the TTM within the finan-
cial management field to examine ways to improve financial
behaviors (Shockey & Seiling, 2004; Xiao et al., 2004; Xu,
2018), design financial therapy interventions (Shelton et al.,
2019), and encourage retirement planning (Horwitz et al.,
2019). Building upon these previous findings, using TTM
in this current study may help interpret participant behav-
ior change, thus improve financial capability during a stable
economy.
Purpose
Between
ID:p01
10
2015 and 2018, MSU Extension educated 2,380
participants, which is the basis of this study. The purpose
of this article is to demonstrate the outcomes of two studies
using standardized statewide evaluation data. The first study
examines pre- and post-program data across 3 years (2015,
2016, and 2017) to determine program participants’ attitu-
dinal and intended behavioral changes. The second study
presents results from a follow-up assessment of 2017 and
2018 participants who completed the program more than
a year earlier. Collectively, this research showed that par-
ticipants were able to maintain positive behavior change
and demonstrated how participants’ overall financial situa-
tions have changed due to the education, including accom-
plishing financial goals. The qualitative comments from the
follow-up assessment revealed insights into the specific fac-
tors that aided or prevented goal achievement. Recommen-
dations have been provided to support future programs with
similar clientele. The samples for these studies were from
program participants enrolled in community-based educa-
tion implemented by Cooperative Extension.
Related
ID:ti0025
Literature
To
ID:p01
15
better identify the need for financial capability educa-
tion, it is important to understand the intended population for
which the education is targeted. Low-income households are
defined by the Department of Housing and Urban Develop-
ment as those below 80% of the area median family income
(Office of Policy Development and Research, n.d.). Often a
financially vulnerable population, the Urban Institute (2009)
found low-income households struggle meeting basic needs,
paying bills, and maintaining employment. Compounding
this concern, Shin and Kim (2018) found that those with
perceived less resources were likely to save less over time.
Low-income consumers often have lower levels of finan-
cial literacy (Lusardi & Mitchell, 2011; Wagner, 2019) and
financial literacy has been linked to healthy financial behav-
ior (Hilgert et al., 2003; Kaiser & Menkhoff, 2017; Shockey
& Seiling, 2004; Walstad et al., 2016; Xu, 2018).
Financial
ID:p0120
literacy and financial capability are terms that
refer to teaching consumers to manage their finances.
Although important, financial literacy alone was found to
be insufficient (Miller et al., 2014), prompting profession-
als to focus on financial capability, as it emphasizes “what
a person does,” and “what a person knows” (Neighbor-
Works America, 2014). Previous studies have shown thatPdf_Folio:232
232 Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 233 — #3
financial literacy and financial capability result in multiple
positive impacts on consumer financial behaviors (Martin,
2007; Miller et al., 2014; Robb & Woodyard, 2011; Xiao
& O’Neill, 2016). For example, increasing consumer confi-
dence along with knowledge creates healthy credit card use
and debt management skills (Ameer & Khan, 2020; Atlas et
al., 2019; Porto & Xiao, 2016). Collectively, the combined
approaches are effective when educating consumers to make
informed decisions and assist in behavior change (Hilgert et
al., 2003).
However,
ID:p0125
less is known on the effectiveness of educational
interventions (Hastings et al., 2013). Mandell and Klein
(2009) found no difference; while a meta-analysis found
one-fifth of financial capability studies showed no impact
or only a modest impact (Miller et al., 2014). Hastings et
al. (2013) added that positive outcomes do not necessarily
cause a relationship between education and behavior. Addi-
tionally, Robb and Woodyard (2011) identified that income,
satisfaction, and confidence may be better outcome predic-
tors. Thus, more research is needed. Exploring the type of
content and appropriate delivery methods are vital to ensure
applied interventions meet consumer needs.
Method
ID:ti0030
This
ID:p0130
article presents survey results from two studies test-
ing outcomes on the same financial capability program from
MSU Extension. The convenience samples were collected
from program participants, some who attended voluntarily
and others who were referred by social service agencies,
and do not reflect a random sample from the population.
The program was designed for community-based audiences
and results are limited to the samples collected and do not
intend to generalize to all U.S. adults. Study 1 examined
pre-test and post-test program evaluation data for partici-
pants combined across 3 calendar years (20152017). The
participant sample was assessed at two measurement points,
which explore short-term changes in knowledge and prac-
tices due to the program. Study 2 contained results from
a follow-up participant study, based from the initial sam-
ple that completed the program, who were assessed between
1 year and 3 years out from receiving the education. By
assessing the follow-up participants, we examined if short-
term changes were maintained and determined if positive
outcomes related to healthy financial practices were contin-
ued over time. Logistics of the program management pro-
hibited the ability to match pre-, post-, and follow-up data
together for each individual participant. Therefore, the two
study samples were analyzed independently. Collectively,
both studies show program outcomes from different points
in time (post- and follow-up) and verify positive changes in
financial practices as a result of the program.
Study
ID:p0135
1 Sample. Extension educators reached 45 of the
state’s 83 counties with face-to-face education. Between
2015 and 2017, 1,267 participants provided program eval-
uation data. If participants were missing data on post-test
measures and only provided demographics and/or pre-test
survey information, the cases were deleted listwise. Thus,
Study 1 had a sample of 706 program participants with
matched pre- and post- outcome data.
Pre- and Post- Program Survey. Financial
ID:p0140
capability edu-
cation program participants completed a standardized set
of evaluation instruments, including a demographic form,
pre-test, and post-test. All survey responses were collected
confidentially to protect participant privacy. Program partic-
ipants were not required to complete evaluations to receive
the intervention, and all replies were voluntary. Demo-
graphic data collection forms were attached to the pre-test
and completed by participants prior to receiving the educa-
tion. The post-test was completed upon program completion
after all lessons (6 hours) had ended.
Follow-Up Survey. Using
ID:p0145
e-mail addresses of past pro-
gram participants, a follow-up study was conducted in
2017 via Survey Monkey to assess longer-term outcomes.
An online survey was administered and 77 program par-
ticipants completed the follow-up assessment. Participants
were asked about the same ten financial practices measured
as program outcomes (Table 1) from the Study 1 surveys. In
addition, participants reported for the last 6 months if take-
home pay and monthly expenses decreased, increased, or
had no change, and by how much. Participants described
their financial situation to help interpret the results. Addi-
tionally, participants reported on the dollar amount they set
aside for savings and the amount they paid toward debt
(decreased, increased, no change) in the last 6 months.
Measures
Study
ID:p0210
1 and Study 2 used a TTM of Behavior Change
framework (Prochaska et al., 1992) for developing the pre-
test, post-test, and follow-up survey instrument. The sur-
vey consisted of 10 program outcomes. The content of thePdf_Folio:233
Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021 233
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 234 — #4
TABLE 1. Outcomes
ID:p0150
Measured in Financial Capability Education Program
Pre-, Post-, and Follow-Up Survey Statements
ID:t0005
1.
ID:p0155
Writing financial goals
2.
ID:p0160
Keeping track of spending and income
3.
ID:p0165
Reviewing all credit card bills and financial statements for accuracy
4.
ID:p0170
Writing out a spending plan
5.
ID:p0175
Saving money regularly
6.
ID:p0180
Obtaining and reviewing credit report annually
7.
ID:p0185
Paying bills on time
8.
ID:p0190
Paying down debt and /or new credit card charges each month
9.
ID:p0195
Obtaining a housing payment that fits within budget
10.
ID:p0200
Making choices today that will make retirement a reality
Note.
ID:p0205
Item order based on survey appearance.
evaluation instrument was developed using the NEFE
Evaluation Toolkit (NEFE, 2019). The evaluation design
allowed for immediate and long-term documentation of
impacts of financial capability programs. Each survey ques-
tion pertained to a financial practice targeted in the program
as an educational objective.
Table
ID:p0215
1 shows 10 financial practices measured based on their
relevance to program outcomes. At the start (pre-) and end
(post-) of the program, participants rated current behaviors
on a five-point Likert-type scale. Measurement was based
on the TTM (Prochaska et al., 1992), which depicts measur-
able, discrete categories of self-reported change. In Study 1
and 2, stages of change corresponded to five categories (1 =
I am not considering this, 2 = I am considering this, 3 = I am
doing this sometimes, 4 = I am doing this most of the time,
5 = I am doing this all of the time).
Analysis
The
ID:p0220
studies assessed what percentage of individuals experi-
enced change in knowledge and skills related to their finan-
cial practices as a result of what they learned. Calculating
change scores to measure individual-level change was a use-
ful analytic strategy for the nonprobability sample. A change
score was calculated for each participant on each of the sur-
vey items by taking a post-test rating (15) and subtract-
ing their pre-test rating (15) on the same item. Change
scores were then recoded as change and no change based
on whether change occurred in the intended direction of the
outcome indicator. If a pre-survey and post-survey had the
same rating, the indicator resulted in a classification of no
change.
In
ID:p0225
addition to calculating individual change scores to look at
individual change, program level outcomes were tested by
comparing the means of pre-survey and post-survey items
for all participants as a group. The dependent ttest used in
Study 1 determined if there was a statistically significant dif-
ference or change in responses pre- and post- the education.
The
ID:p0230
demographic data form collected self-reported gender,
county residence, annual income, current work status, eth-
nicity, and race. Program participants’ options for gender
were male and female. Annual income was asked in five cat-
egories based on area median family income guidelines set
by U.S. Housing and Urban Development (Office of Pol-
icy Development and Research, n.d.). Participants reported
their current work status: whether work was full-time or
part-time, temporary, or if they were unemployed. Ethnic-
ity and race included Hispanic or Latino, American Indian,
Asian, Black or African American, and White or Caucasian.
Participants could refuse to answer any question or select
that they wish not to provide. Table 2 shows the demograph-
ics of the Study 1 and Study 2 samples.
Open-ended
ID:p0235
questions included on the follow-up survey
were analyzed, and the text was open-coded to better under-
stand the change in behavior experienced by participants.
Questions focused on the changes made in their financial
practices and the specific factors that helped or prevented
financial goal achievement. Participant responses were first
grouped into themes and a codebook was created based
on class content and additional findings raised by partici-
pants. Multiple reviewers analyzed the findings to ensure
trustworthiness and member checking was completed to
Pdf_Folio:234
234 Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 235 — #5
TABLE 2. Financial
ID:p0240
Capability Program Participant Characteristics
Variables Pre and Post Sample NPre and Post % Follow-Up Sample NFollow-Up %
ID:t0010
Gender
ID:t0015
ID:t0020
ID:t0025
ID:t0030
Women
ID:t0035
404
ID:t0040
57
ID:t0045
34
ID:t0050
72
ID:t0055
Men
ID:t0060
300
ID:t0065
43
ID:t0070
12
ID:t0075
28
ID:t0080
Race and ethnicity
ID:t0085
ID:t0090
ID:t0095
ID:t0100
ID:t0105
Hispanic or Latino
ID:t01
10
39
ID:t01
15
6
ID:t0120
4
ID:t0125
10
ID:t0130
American Indian
ID:t0135
21
ID:t0140
3
ID:t0145
1
ID:t0150
1
ID:t0155
Asian
ID:t0160
11
ID:t0165
2
ID:t0170
2
ID:t0175
5
ID:t0180
Black, African American
ID:t0185
210
ID:t0190
30
ID:t0195
15
ID:t0200
34
ID:t0205
White, Caucasian
ID:t0210
397
ID:t0215
56
ID:t0220
22
ID:t0225
50
ID:t0230
Annual income
ID:t0235
ID:t0240
ID:t0245
ID:t0250
ID:t0255
Less than $17,900
ID:t0260
375
ID:t0265
57
ID:t0270
14
ID:t0275
33
ID:t0280
$17,900 to $29,850
ID:t0285
117
ID:t0290
18
ID:t0295
7
ID:t0300
17
ID:t0305
$29,851 to $47,750
ID:t0310
88
ID:t0315
13
ID:t0320
14
ID:t0325
33
ID:t0330
$47,751 to $59,600
ID:t0335
26
ID:t0340
4
ID:t0345
4
ID:t0350
10
ID:t0355
More than $59,600
ID:t0360
49
ID:t0365
8
ID:t0370
3
ID:t0375
7
ID:t0380
Current work status
ID:t0385
ID:t0390
ID:t0395
ID:t0400
ID:t0405
Full-time
ID:t0410
193
ID:t0415
35
ID:t0420
26
ID:t0425
60
ID:t0430
Part-time
ID:t0435
79
ID:t0440
14
ID:t0445
7
ID:t0450
16
ID:t0455
Unemployed
ID:t0460
282
ID:t0465
51
ID:t0470
10
ID:t0475
24
Note.
ID:p0245
Missing or refused to provide date on income 4% in pre and post and 11% in the follow-up study. Follow-up sample
includes demographics for up to 47 of 77 participants.
warrant an accurate interpretation of the data (Richards,
2009). All study aims, scopes, and protocol were submitted
to and approved by Michigan State University’s Institutional
Review Board.
Results
ID:ti0045
MSU
ID:p0250
Extension’s financial capability education pro-
gram improved participant’s consumer financial outcomes
through learning and intended behavioral change. Results
from Study 1 show the pre- and post-program outcomes for
706 participants. According to calculated individual change
scores, this study found percent-changed ranging from 35%
to 53%. Table 3 presents each of the 10 financial practices
measured pre- and post-program. Means were greater on
post-test ratings for each item, and a significant t test is
presented for program outcome indicators. Pre- and post-
test data show the number of individuals changed and the
percent of the sample with positive changes in financial
capability
Results
ID:p0265
show significant program effectiveness (t test) and
provide a baseline of expected percent-change as a com-
parison for the follow-up study. The top four outcomes
indicating positive change included writing out a spend-
ing plan, obtaining and reviewing credit reports annually,
writing financial goals, and making choices today that will
make retirement a reality. Table 4 compares the pre-test
and post-test data with the follow-up surveys collected as
independent groups with means and percent change dis-
played. Results show percentage of participants engaged
in positive practices that maintained or changed due to the
program.
Study
ID:p0270
2 was a follow-up survey with 77 participants who
had completed the program 13years prior. Participants
reported changes made in their personal financial practices
and how their overall financial situation changed since pro-
gram completion (Table 4). Participants reported for the last
6 months if take home pay and monthly expenses decreased,
increased, or had no change. Participants reported on the
amount they set aside for savings and the amount they paid
toward debt (decreased, increased, no change) in the last 6
months.
The
ID:p0285
results showed a link between the education received
and the participants’ improved financial outcomes. For
Pdf_Folio:235
Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021 235
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 236 — #6
TABLE 3. Pre-
ID:p0255
and Post- Financial Capacity Program Outcomes
Pre Post
Program Outcome M SD M SD Percent Changed (n)df t
ID:t0480
1
ID:t0485
2.57
ID:t0490
1.06
ID:t0495
3.10
ID:t0500
1.13
ID:t0505
48% (320)
ID:t0510
662
ID:t0515
−12.07***
ID:t0520
2
ID:t0525
3.17
ID:t0530
1.18
ID:t0535
3.64
ID:t0540
1.12
ID:t0545
46% (309)
ID:t0550
668
ID:t0555
−10.20***
ID:t0560
3
ID:t0565
2.94
ID:t0570
1.36
ID:t0575
3.40
ID:t0580
1.23
ID:t0585
46% (275)
ID:t0590
598
ID:t0595
−9.63***
ID:t0600
4
ID:t0605
2.57
ID:t0610
1.11
ID:t0615
3.27
ID:t0620
1.17
ID:t0625
53% (344)
ID:t0630
647
ID:t0635
−14.01***
ID:t0640
5
ID:t0645
2.87
ID:t0650
1.16
ID:t0655
3.35
ID:t0660
1.16
ID:t0665
45% (294)
ID:t0670
657
ID:t0675
−10.47***
ID:t0680
6
ID:t0685
2.46
ID:t0690
1.22
ID:t0695
2.99
ID:t0700
1.24
ID:t0705
49% (301)
ID:t0710
619
ID:t0715
−10.70***
ID:t0720
7
ID:t0725
3.56
ID:t0730
1.26
ID:t0735
3.80
ID:t0740
1.14
ID:t0745
35% (224)
ID:t0750
641
ID:t0755
−5.81***
ID:t0760
8
ID:t0765
2.93
ID:t0770
1.34
ID:t0775
3.33
ID:t0780
1.27
ID:t0785
44% (237)
ID:t0790
542
ID:t0795
−8.90***
ID:t0800
9
ID:t0805
2.86
ID:t0810
1.38
ID:t0815
3.38
ID:t0820
1.33
ID:t0825
43% (234)
ID:t0830
545
ID:t0835
−8.14***
ID:t0840
10
ID:t0845
2.59
ID:t0850
1.20
ID:t0855
3.14
ID:t0860
1.28
ID:t0865
48% (293)
ID:t0870
610
ID:t0875
−11.31***
Note
ID:p0260
.Program outcomes are listed in survey order. M= Mean. SD = standard deviation. Percent changed indicates number
of participants that improved on program outcome. ***p< .001. Pre- and post- outcomes for program participants (n= 706).
TABLE 4. Follow-Up
ID:p0275
Compared to Pre- and Post- Program Outcomes
Pre Post Follow-Up
Program Outcome M SD M SD M SD
Percent
Changed and
Maintained
Pre and Post
Percent
Changed
Follow-Up
(3, 4, 5)
Percent
Changed
Follow-Up
(4, 5 only)
ID:t0880
1
ID:t0885
2.57
ID:t0890
1.06
ID:t0895
3.10
ID:t0900
1.13
ID:t0905
3.34
ID:t0910
1.06
ID:t0915
66%
ID:t0920
81%
ID:t0925
44%
ID:t0930
2
ID:t0935
3.17
ID:t0940
1.18
ID:t0945
3.64
ID:t0950
1.12
ID:t0955
4.03
ID:t0960
1.11
ID:t0965
75%
ID:t0970
87%
ID:t0975
30%
ID:t0980
3
ID:t0985
2.94
ID:t0990
1.36
ID:t0995
3.40
ID:t1000
1.23
ID:t1005
4.00
ID:t1010
1.20
ID:t1015
71%
ID:t1020
83%
ID:t1025
74%
ID:t1030
4
ID:t1035
2.57
ID:t1040
1.11
ID:t1045
3.27
ID:t1050
1.17
ID:t1055
3.34
ID:t1060
1.21
ID:t1065
69%
ID:t1070
70%
ID:t1075
44%
ID:t1080
5
ID:t1085
2.87
ID:t1090
1.16
ID:t1095
3.35
ID:t1
100
1.16
ID:t1
105
3.52
ID:t1
1
10
1.21
ID:t1
1
15
69%
ID:t1
120
79%
ID:t1
125
49%
ID:t1
130
6
ID:t1
135
2.46
ID:t1
140
1.22
ID:t1
145
2.99
ID:t1
150
1.24
ID:t1
155
3.36
ID:t1
160
1.47
ID:t1
165
63%
ID:t1
170
63%
ID:t1
175
50%
ID:t1
180
7
ID:t1
185
3.56
ID:t1
190
1.26
ID:t1
195
3.80
ID:t1200
1.14
ID:t1205
4.30
ID:t1210
0.92
ID:t1215
74%
ID:t1220
94%
ID:t1225
83%
ID:t1230
8
ID:t1235
2.93
ID:t1240
1.34
ID:t1245
3.33
ID:t1250
1.27
ID:t1255
3.72
ID:t1260
1.22
ID:t1265
70%
ID:t1270
80%
ID:t1275
60%
ID:t1280
9
ID:t1285
2.86
ID:t1290
1.38
ID:t1295
3.38
ID:t1300
1.33
ID:t1305
3.92
ID:t1310
1.33
ID:t1315
64%
ID:t1320
77%
ID:t1325
72%
ID:t1330
10
ID:t1335
2.59
ID:t1340
1.20
ID:t1345
3.14
ID:t1350
1.28
ID:t1355
3.46
ID:t1360
1.29
ID:t1365
64%
ID:t1370
71%
ID:t1375
54%
Note.
ID:p0372
SD = standard deviation. Percent
ID:p0280
changed and maintained pre- and post- column indicates individual change, in that
these participants engaged in positive financial behaviors more frequently as a result of the education or were already engaged
in the practices pre- and post- program. Percent changed follow-up column shows the percentage of participants who rated
themselves as a 3 (doing sometimes), 4 (doing most of the time), or 5 (doing all of the time) on the follow-up assessment.
The shaded column shows the percentage of participants with only 4 (most of the time) or 5 (all of the time) ratings on the
follow-up assessment.
example, 53% increased monthly take home pay, 28%
decreased expenses, 34% increased savings, and 37% were
able to pay off additional debt. Ninety-one percent reached
a goal, including starting an emergency fund, reducing debt,
and opening accounts.
Qualitative Findings From the Follow-up Assessment
Qualitative
ID:p0290
data provided insight into participant achieve-
ments since time of education (Table 5). Changed finan-
cial practices included “objectively assessing whether an
expense is something that I need,” and “watch(ing) what I
Pdf_Folio:236
236 Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 237 — #7
TABLE 5. Qualitative
ID:p0295
Themes
Questions Broad Themes Key Response Areas
ID:t1380
What changes have you made
in your financial practice as
a result of what you learned?
ID:t1385
Making Money Decisions
ID:t1390
Needs and Wants (n= 6) Avoiding
Impulse Buys (n= 4) Financial Goals (n
= 4) Finances and Relationships (n= 2)
ID:t1395
Creating and Manag-
ing a Spending Plan
ID:t1400
Budgeting/Spending Plan (n= 16)
Tracking (n= 14) Paying Bills on
Time (n= 6)Increasing Income (n= 4)
ID:t1405
Importance of Saving and Investing
ID:t1410
Saving (n= 7) Retirement (n= 2)
ID:t1415
Credit and Debt Management
ID:t1420
Credit and Debt Management (n=
7) Increasing Credit Score (n= 2)
ID:t1425
Tell us more about reaching
your personal financial goals.
What helped or what prevented
you from achieving your goals?
ID:t1430
Making Money Decisions
ID:t1435
Helped: Financial Goal Setting (n= 7)
Prevented:Impulse Spending (n= 1) Cop-
ing With Unexpected Situations (n= 11)
ID:t1440
Creating and Manag-
ing a Spending Plan
ID:t1445
Helped: Eliminating Unnecessary
Expenses (n= 4) Budgeting/Spending
Plan or Tracking (n= 12) Increasing
Income (n= 3) Paying Bills on Time
(n= 1) Understanding Benefits (n= 1)
ID:t1450
Importance of Saving and Investing
ID:t1455
Helped: Saving (n= 4) Retirement (n= 2)
ID:t1460
ID:t1465
Credit and Debt Management
ID:t1470
Helped: Credit and Debt Manage-
ment (n= 3) Pay Down Debt (n=
3) Increased Credit Scores (n= 2)
Note.
ID:p0300
N= number of participants who mentioned this theme within the qualitative comments during the follow-up assessment.
purchase.” Participants identified “keep(ing) . . . track of
due dates,” with one participant revealing her “FICO score
[increased] from 680 to 776.” Helpful strategies included
being more mindful,” “establishing priorities,” and “track-
ing payments,” with, “put[ting] away money monthly” and
start[ing] a 401k” as reported goals. Participants shared
“unemployment” and “high medical bills” as barriers.
Discussion
ID:ti0055
The
ID:p0305
results of this study show a link between the imple-
mented program and positive behavior change for a vulner-
able population. This study reported the findings from par-
ticipants who completed a 6-hour educational class between
2015 and 2017. Participants’ changed their attitudes and
took action based on class content and showed positive
change in each assessed indicator. Over one-third of partic-
ipants who responded increased savings, with another third
decreasing the amount of debt from prior years. Qualitative
data confirmed and illustrated the quantitative findings.
The
ID:p0310
findings generated several key implications. The study
assessed an economically vulnerable population with most
participants reporting incomes below $17,900 and work sta-
tus as unemployed/part-time. Additionally, the study sam-
ple reflected the state’s racial and ethnic diversity. Despite
being an economically vulnerable population who benefit-
ted from the education, program participants did reveal bar-
riers to goal attainment.
Although
ID:p0315
all participants received the same program, the
findings suggest a participant’s ability to apply the content
received was subject to their ability to reduce barriers, such
as access to and continuation of employment or the ability
to earn sufficient income to maintain basic needs. As con-
firmed in the qualitative data, participants were more likely
to report program success when they could apply the skills
received and overcome unexpected financial situations.
Revisiting the Theoretical Framework
Based
ID:p0320
on the study results, TTM, which was used to assess
a participant’s ability to achieve change, was found to
be appropriate and useful in interpreting financial behav-
ior practices over time. The results of these studies showPdf_Folio:237
Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021 237
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 238 — #8
support for effectiveness of community-based education on
financial capability and that TTM can be used as a mea-
surement strategy for assessing change. The quantitative
portion of these studies provided three time points of data
(pre-, post-, and follow-up assessments) to determine pos-
itive participant behavior change. Using the follow-up
assessment, including the qualitative data, provided an
insight into the participant’s level and type of change as a
result of the intervention applied.
Limitations and Future Research
The
ID:p0325
studies have limitations as both samples are prone
to selection bias. As found in Xu (2018) when assessing
community-based outcomes, selection bias is common. Par-
ticipants were not assigned to the educational program,
however some were recommended by local agencies, and
participants voluntarily attended classes. Given this, it is
important to recognize that few people attending an edu-
cational program would be considered pre-contemplative.
Potential bias also was inherent in those who replied to the
follow-up assessment, with those in better financial situ-
ations willing and able to reply to the survey. Addition-
ally, these studies are illustrative of the types of changes
that participants make from gaining knowledge and skills
in financial capability programs; as such, the analysis of
outcomes did not control for confounding factors. Instead,
demographic characteristics of the samples (e.g., race/eth-
nicity, gender) were used to explore mean differences in
change scores among program participants and no signif-
icant differences were found. This lack of significant dif-
ferences among groups of participants provided evidence
that the program was effective across varying audiences that
were demographically representative of (state)’s population
and reflective of the target program audience.
Additional
ID:p0330
study limitations exist. The program was con-
ducted during post-recession economic conditions in just
one state. The positive behavior change reported and the
ability to maintain the change must be understood within
this context. Given this, it is difficult to ascertain if suc-
cessful outcomes were due to the educational intervention,
the improving economy, or both. As mentioned, the study
samples were not randomized and therefore are not repre-
sentative results for an entire population. Using participant
contact lists across multiple program years allowed for a
larger sample to be examined which helps reduce inherit
bias in the opportunity census sample. It is common in
community-based educational programs to have data from
convenience samples because participants are not assigned
interventions randomly, but rather voluntarily participate
when they are ready to make lifestyle changes toward
health financial practices. Also, follow up evaluation results,
although strong, were limited in numbers, and each response
was not tied to a specific pre/post case. Thus, it is hard to
assess considerable long-term individual change.
Although
ID:p0335
low numbers exist, specific participant behav-
ior changes were still reported giving an insight into the
education’s influence. Future research should gather lon-
gitudinal research that follows a larger dataset over a
longer time-period. Adding a fourth period of assessment
could also strengthen the findings and give further insight
on sustained participant changes. To counteract selection
bias, future studies could incorporate a randomized con-
trolled design with a comparison group to reduce this con-
cern. Future research that collects data from multiple states
that are implementing the same program would also be
beneficial.
Implications
ID:ti0070
for Practitioners
To
ID:p0340
ensure that financial education content meets partici-
pant needs, recommendations and implications have been
identified for educators, counselors, and financial planners.
First, providing education alone may not be enough to facil-
itate long-term behavior change (NeighborWorks America,
2014). Helping to alleviate barriers for participants is criti-
cal. By providing community-based education through the
Cooperative Extension model of university outreach, edu-
cators can deliver programs locally and work with key part-
ners to foster partnerships that support clientele.
Second,
ID:p0345
the delivery and location of where programs
occur matter. MSU Extension financial capability programs
occurred at sites centrally located to the consumer. Schaf-
fer and Mohs (2016) found that providing financial lit-
eracy programs at trusted, known locations where clients
often receive additional services is essential. In addition, the
same study suggests that flexibility in delivery is important.
Due to time constraints and population transiency, attend-
ing a long-term, static class may prove difficult when fos-
tering behavior change. Within this program, classes were
planned on a regular and consistent basis so participants
could start and finish the 6-hour series when it was con-
venient and available to them. Schaffer and Mohs (2016)Pdf_Folio:238
238 Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 239 — #9
found that when programs were offered with the audience
in mind, there is a greater likelihood of participation, long-
term change, and a positive effect on participant economic
stability.
Third,
ID:p0350
content and delivery of financial capability pro-
grams may need adjustments. Kim et al. (2017) suggests
including couples and children in household-level interven-
tions for financial capability education to provide additional
insights and positive changes related to spending choices,
investments, and other financial socialization. Incorporating
confidence building activities to promote healthy financial
behaviors may also be useful to bolster knowledge gains
from education (Atlas et al., 2019).
In
ID:p0355
addition, bundling programs with similar content may
be important. Within this study, educational programs were
often bundled with offerings from community partners. The
Administration for Children and Families (n.d.) found that
integrating financial literacy education with other nonfi-
nancial programs, such as workforce development, could
increase effectiveness. Finally, the timing of education is
key. The Consumer Financial Protection Bureau (2017)
found that there is a direct correlation between one’s ability
to achieve goals and participant confidence.
This
ID:p0360
study took place during a period of economic recov-
ery. As an economy moves from recession to recovery or
recovery to recession, further research may inform the con-
nection between one’s ability to achieve financial goals and
participant confidence. Thus, helping participants not only
understand but apply the content may be beneficial. Taken
together, the results in the current study showed value in
community-based financial capability programs and pro-
vided recommendations for future research and programs.
References
ID:ti0075
Administration for Children and Families, Depart-
ment of Health and Human Services. (n.d.). About
financial capability services. https://www.acf.
hhs.gov/sites/default/files/ocs/financial_capability_
services_0.pdf
Ameer, R., & Khan, R. (2020). Financial socialization,
financial literacy, and financial behavior of adults in
New Zealand. Journal of Financial Counseling and
Planning. doi:10.1891/JFCP-18-00042
Anderson-Porisch, S. J., Heins, R. K., Petersen, C. M.,
Hooper, S. E., & Bauer, J. W. (2007). Dollar works 2:
A personal financial education program (item 08503).
University of Minnesota Extension.
Atlas, S. A., Lu, J., Micu, D., & Porto, N. (2019). Financial
knowledge, confidence, credit use and financial satis-
faction. Journal of Financial Counseling and Planning,
30(2), 175190. doi:10.1891/1052-3073.30.2.175
Bauer, J. W., Son, S., Hur, J., Anderson-Porisch, S., Heins,
R., Petersen, C., Barrett Wiik, N. (2011). Dol-
lar works 2: Impact evaluation report . University
of Minnesota Extension, Center for Family Develop-
ment. The University of Minnesota Digital Conser-
vancy. http://hdl.handle.net/11299/194187
Consumer Financial Protection Bureau. (2017). Finan-
cial wellbeing in America. https://www.consumerfina
nce.gov/data-research/research-reports/financial-well-
being-america/
FINRA. (2015). Financial capability study. http://www.
usfinancialcapability.org/
Haskins, R. (2015). Challenges facing low-
income individuals and families. [Testimony].
https://www.brookings.edu/testimonies/challenges-
facing-low-income-individuals-and-families/
Hastings, J. S., Madrian, B. C., & Skimmyhorn, W. L.
(2013). Financial literacy, financial education, and
economic outcomes. Annual Review of Economics,
5, 347373. https://pdfs.semanticscholar.org/f74d/4726
5b64ac646d50047791cbf1a214ab89f8.pdf
Hilgert, M. A., Hogarth, J. M., & Beverly, S. G.
(2003). Household financial management: The
connection between knowledge and behav-
ior. Federal Reserve Bulletin,89, 309322.
https://www.federalreserve.gov/pubs/bulletin/2003/0703
lead.pdf
Horwitz, E. J., Klontz, B. T., & Zabek, F. (2019). A finan-
cial psychology intervention for increasing employee
participation in and contribution to retirement plans:
Results of three trials. Journal of Financial Counseling
and Planning,30, 262276.
Kaiser, T., & Menkhoff, L. (2017). Does financial education
impact financial literacy and financial behavior, and if
so, when? The World Bank Economic Review,31(3),
611630. doi:10.1093/wber/lhx018
Kim, J., Gutter, M. S., & Spangler, T. (2017). Review
of family financial decision making: Suggestions
for future research and implications for financial
Pdf_Folio:239
Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021 239
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 240 — #10
education. Journal of Financial Counseling and Plan-
ning,28(2), 253267. doi:10.1891/1052-3073.28.2.253
Loibl, C., & Hira, T. K. (2007). New insights into advis-
ing female clients on investment decisions. Journal of
Financial Planning,20(3), 6875.
Lusardi, A., & Mitchell, O. S. (2011). Financial literacy and
retirement preparedness: Evidence and implications for
financial education. Journal of Pension Economics and
Finance,10(4), 509525. doi:10.2145/20070104
Mandell, L., & Klein, L. S. (2009). The impact of financial
literacy education on subsequent financial behavior.
Journal of Financial Counseling and Planning,20(1),
1524.
Martin, M. (2007). A literature review on the
effectiveness of financial education. Federal
Reserve Bank of Richmond. https://www.
richmondfed.org/publications/research/working_papers/
2007/wp_07-3
Miller, M., Reichelstein, J., Salas, C., & Zia, B. (2014).
Can you help someone become financially capable?
A meta-analysis of the literature. The World Bank Pol-
icy Research Working Paper 6745. http://documents.
worldbank.org/curated/en/297931468327387954/pdf/
WPS6745.pdf
National Endowment for Financial Education.
(2019). Financial education evaluation
toolkit and manual. https://toolkit.nefe.org/,
https://toolkit.nefe.org/evaluation-resources/eva
luation-manual/section-1-introduction/introduction-
nefes-financial-education-evaluation-manual
NeighborWorks® America. (2014). Getting it right:
Promising practices for financial capability programs.
NeighborWorks Consumer Finance Survey.
(2015). http://www.neighborworks.org/Homes-
Finances/Financial-Security/Survey-results
Office of Policy Development and Research.
(n.d). Methodology for determining section
8 income limits. U.S. Department of Hous-
ing and Urban Development. https://www.
huduser.gov/portal/datasets/il//il20/IncomeLimits
Methodology-FY20.pdf
Porto, N., & Xiao, J. J. (2016). Financial literacy overconfi-
dence and financial advice seeking. Journal of Finan-
cial Service Professionals,70(4), 7888.
Prochaska, J. O., DiClemente, C. C., & Norcross, J. C.
(1992). In search of how people change: Applications
to addictive behaviors. American Psychologist,47(9),
11021114.
Prochaska, J. O., Redding, C. A., & Evers, K. E. (1996).
The transtheoretical model and stages of change. In
K. Glanz, F. M. Lewis, & B. K. Rimer (Eds.), Health
behavior and health education: Theory, research, and
practice (2nd ed., pp. 6084). Jossey-Bass.
Richards, L. (2009). Handling qualitative data. Sage.
Robb, C. A., & Woodyard, A. (2011). Financial knowledge
and best practice behavior. Journal of Financial Coun-
seling and Planning,22(1), 6166.
Schaffer, B. A., & Mohs, J. N. (2016). Explor-
ing the effect of financial literacy programs on
low-income adults. The Journal of Global Busi-
ness Management,12(2), 6768. http://www.
jgbm.org/page/7%20Brigid%20A%20Schaffer.pdf
Shelton, V. M., Smith, T. E., & Panisch, L. S. (2019). Finan-
cial therapy with groups: A case of the five-Ssep model.
Journal of Financial Counseling and Planning,30(1),
1826.
Shin, S. H., & Kim, K. T. (2018). Perceived saving changes,
perceived motives, and household savings. Journal
of Financial Counseling and Planning,29, 396409.
doi:10.1891/1052- 3073. 29.2.396
Shockey, S. S., & Seiling, S. B. (2004). Moving into action:
Application of the transtheoretical model of behavior
change to financial education. Journal of Financial
Counseling and Planning,15(1), 4152.
U.S. Bureau of Labor Statistics. (n.d.a).
Economy at a Glance, April 2018.
https://www.bls.gov/eag/eag.us.htm
U.S. Bureau of Labor Statistics. (n.d.b). Local
area unemployment statistics: Michigan.
https://data.bls.gov/timeseries/LASST260000000000003
University of Minnesota Extension. (n.d.). Dollar Works
2: A personal finance educational program. [Web-
site]. https://extension.umn.edu/teaching-personal-
finance/dollar-works-2-personal-financial-education-
program
Urban Institute. (2009). Low-income work-
ing families: Updated facts and figures.
https://www.urban.org/sites/default/files/publication/
32971/411900-low-income-working-families-updated-
facts-and-figures.pdf
Wagner, J. (2019). Financial education and financial lit-
eracy by income and education groups. Journal of
Pdf_Folio:240
240 Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021
“JFCP-19-00020_ProofPDF” — 2021/8/21 — 8:11 — page 241 — #11
Financial Counseling and Planning,30(1), 132141.
doi:10.1891/1052-3073.30.1.132
Walstad, W., Urban, C., Asarta, C., Breitbach, E., Bosshardt,
W., Heath, J., . . . Xiao, J. J. (2016). Perspectives on
evaluation in financial education: Landscape, issues,
and studies . The National Endowment for Finan-
cial Education. https://toolkit.nefe.org/evaluation-
resources/evaluation-white-paper/introduction
Xiao, J. J. (2008). Applying behavior theories to finan-
cial behavior. In J. Xiao (Ed.), Handbook of consumer
finance research. Springer Publishing.
Xiao, J. J., & O’Neill, B. (2016). Consumer financial
education and financial capability. International
Journal of Consumer Studies,40(6), 712721.
doi:10.1111/ijcs.12285
Xiao, J. J., Newman, B. M., Prochaska, J. M., Leon, B., Bas-
sett, R., & Johnson, J. L. (2004). Applying the Trans-
Theoretical model of change to debt reducing behavior.
Journal of Financial Counseling and Planning,15(2),
89100.
Xu, X. (2018). Assessing a community based financial liter-
acy program: A case study in California’s Silicon Val-
ley. Journal of Financial Counseling and Planning,29,
142153. doi:10.1891/1052-3073.29.1.142
Disclosure
ID:p0365
. The authors have no relevant financial interest
or affiliations with any commercial interests related to the
subjects discussed within this article.
Acknowledgments
ID:p0370
. As authors, we acknowledge that this
manuscript has not been published in any form. The material
in the manuscript will not infringe upon any statutory copy-
right and the article will not be submitted elsewhere while
under JFCP review.
Funding
ID:p0371
. The author(s) received no specific grant or finan-
cial support for the research, authorship, and/or publication
of this article.
Pdf_Folio:241
Journal of Financial Counseling and Planning, Volume 32, Number 2, 2021 241
Article
This scoping review examined what is known in the literature about Hispanic/Latinx unbanked households. It used Arksey and O'Malley’s (2005) five-step process to analyze 12 peer-reviewed research articles from preselected databases and journals. Using Braun and Clarke’s (2006) Reflexive Thematic Analysis, the author constructed three themes to synthesize the literature. The first theme is about data sets used that include both nationally representative data sets and smaller data sets collected locally. The second theme showed that “unbanked” has not been consistently defined across the literature varying according to the account type, institution type, and account owner. The third theme revealed the reasons why Hispanic/Latinx households might be unbanked. The results have implications for future research and financial practitioners who work with Hispanic/Latinx clientele.
Article
Research has shown that poverty simulations are an effective tool for teaching about the lived realities of poverty. In the Community Action Poverty Simulation, participants simulate the roles of adults, children, or community workers. This qualitative study analyzed college students’ reflection papers to assess their experiences simulating the child’s role. Three themes emerged from the analysis: helplessness, the impact of childhood poverty, and future actions based on the experience. Students who simulated the child roles reported feeling helpless, developed more compassionate attitudes toward poverty, and cited specific antipoverty actions they planned to take due to the experience. This study demonstrated the importance of experiencing a child’s perspective to help understand poverty and has implications for financial counselors, planners, and educators.
Article
This research aims to see how gender differs in the financial capability and financial behavior of people in Surabaya. The number of respondents in this study was 204 people. The criteria for respondents in this study were to be over 17 years old and domiciled in Surabaya. The method used in this research is the independent t test and ANOVA test. The results found from this research are that there are differences in the financial capability of men and women. Men are said to be better in financial capability than women. Apart from that, the results also found that there were no differences in the financial behavior of men and women. This research also found something else, namely that the higher a person's financial capability, the better that person's financial behavior will be.
Article
Full-text available
Objectives This study aimed at exploring the factors associated with the reduction in the proportion of women reporting unwanted births in Bangladesh between 2007 and 2017/2018. Design and setting A cross-sectional analysis of the data collected by the 2007 and 2017/2018 Bangladesh Demographic and Health Surveys by using a two-stage stratified sampling covering the entire population in Bangladesh. Participants Our analysis included 4810 (2007) and 7403 (2017/2018) weighted ever-married women aged 15–49 years reporting at least one birth in the 5 years preceding each of the surveys. Results The proportion of women reporting unwanted births declined by 26.2% between 2007 and 2017/2018. Overall changes in women’s behaviour and their proportions with distinct characteristics explained 66.2% (0.051 points decrease, 95% CI −0.071 to –0.031, p<0.001) and 45.5% (0.035 points decrease, 95% CI −0.051 to –0.019, p<0.001) of the overall reduction in the proportion reporting unwanted births, respectively. Behavioural changes among those being visited by family planning (FP) workers (0.004 points decrease, 95% CI −0.008 to –0.000, p=0.047), having complete secondary education or higher (0.009 points decrease, 95% CI −0.016 to –0.003, p=0.002), and earning in kind (0.002 points decrease, 95% CI −0.005 to –0.000, p=0.035) were associated with a reduction in unwanted childbearing. Increases in the proportions of women married at age 18 or older (0.008 points decrease, 95% CI −0.010 to –0.005, p<0.001), and having some secondary education (0.013 points decrease, 95% CI −0.019 to –0.008, p<0.001) were negatively associated with unwanted childbearing. Conversely, an increase in the proportion expressing preference for a balanced sex composition of the family was positively associated with unwanted childbearing (0.013 points increase, 95% CI 0.008 to 0.017, p<0.001). Conclusions Women’s behavioural changes driven by the FP programmes and other external factors, and changes in their characteristics, could reduce the incidence of unwanted childbearing in Bangladesh, and thereby contribute to improvements in maternal health.
Article
When the COVID-19 pandemic caused businesses to close and triggered high unemployment in 2020, millions of unbanked U.S. households, those without a bank account, had to wait for weeks and months for their stimulus checks to arrive. The delayed delivery of stimulus checks issued by the Coronavirus Aid, Relief, and Economic Security (CARES) Act sheds light on the critical role that safe, affordable financial services and products play in people’s ability to cope with financial shocks. Dialogues over banking practices have been framed with a banked-unbanked dichotomous framework that masks more nuanced understandings of households’ financial realities, including the underbanked, who use a bank account and alternative financial services simultaneously. Using data from the 2015 National Financial Capability Study, this study identifies and compares predictors of being underbanked and unbanked, respectively. We found that the underbanked group is a sizable, distinctively different group. Income volatility and welfare benefit receipt are both associated with being underbanked rather than unbanked. Our findings call for expanding the current, limited framework to gain more complete, nuanced understandings of banking practices.
Article
This article summarizes a field-based experiment exploring an individual and small-group financial coaching intervention. Both types of coaching programs had the same goal: To develop clients’ financial capability through a series of planned meetings focusing on client driven goals. Results indicated clients who were coached either individually or in groups demonstrated increases in financial knowledge, gains in confidence, reductions in stress, and positive changes in behavior. The findings provide support for coaching as an intervention for developing financial capability and suggests group coaching as an alternative for reaching more clients and spreading financial capability more widely in a cost-effective way.
Article
Full-text available
In a meta-analysis of 126 impact evaluation studies, we find that financial education significantly impacts financial behavior and, to an even larger extent, financial literacy. These results also hold for the subsample of randomized experiments (RCTs). However, intervention impacts are highly heterogeneous: financial education is less effective for low-income clients as well as in low- and lower-middle-income economies. Specific behaviors, such as the handling of debt, are more difficult to influence and mandatory financial education tentatively appears to be less effective. Thus, intervention success depends crucially on increasing education intensity and offering financial education at a "teachable moment". © The Author 2016. Published by Oxford University Press on behalf of the International Bank for Reconstruction and Development / THE WORLD BANK. All rights reserved.
Article
Full-text available
This review discusses the heterogeneity in the effectiveness of financial education programs that occurs because of the unique conditions for programs and methods to evaluate them. The authors define six groups served by financial education: children, youth, college students and young adults, working adults, military personnel, and low-income consumers. They then discuss research and evaluation literature for each group with a critical eye on program purpose, content, and evaluation. They also present findings affecting multiple groups on four issues: student loans, homeownership, retirement planning, and financial advising. The accumulated evidence on the effectiveness of financial education is positive, although the results are nuanced and sometimes limited. The authors argue that understanding this broad landscape in studying financial education is critical for future research and evaluation.
Article
We used survey data from a cross-sectional New Zealand sample of adults to examine whether financial socialization and financial literacy are associated with their financial behavior. The results show different financial socialization experiences of adult males compared to adult females are associated with higher financial literacy and higher financial confidence. Adults with education in finance and economics had higher financial literacy and financial confidence in managing their personal finances. Furthermore, those with high self-assessed confidence in managing personal finance but low financial literacy, have a higher propensity to engage in undesirable financial behaviors.
Article
Despite decades of retirement plan enrollment meetings, many employees fail to fully engage in their employer-sponsored retirement plans. Under the framework of the Transtheoretical Model (TTM) of Behavior Change, this study examines the effectiveness of a financial psychology intervention designed to increase engagement in employer-sponsored retirement plans across three employee groups: 107 employees of a regional bank, 43 employees of a custom manufacturing company, and 48 employees of a construction company. Following the intervention, significant changes in plan participation, contribution rates, and one-on-one follow-up meetings with financial advisors were observed. Thirty-eight percent of previously unengaged employees became plan participants, 68% requested and held meetings with financial advisors, and contribution rates increased by 39%, resulting in a total $199,445 increase in first-year annualized contributions and employer matching funds across the three groups.
Article
This article investigates associations between confidence about financial knowledge and two outcome variables, financial behaviors and financial satisfaction. On one hand, subjective financial knowledge (confidence) is necessary to make proactive decisions, yet overconfidence has been associated with a range of negative financial behaviors and outcomes. Both types of objective and subjective knowledge may be related to critical financial behaviors and choices such as credit card usage which in turn may be associated with financial satisfaction, an important component of consumer well-being. This article analyzes data from the 2015 National Financial Capability Study to examine how financial knowledge confidence relates to credit card behaviors and financial satisfaction. We use mediation and floodlight analyses to uncover relevant relationships between variables of interest. We find evidence that confidence is associated with healthy credit card use that contributes to financial satisfaction. We also observe strong interactions with knowledge to find that confidence is more strongly associated with credit card use and overall financial satisfaction as knowledge increases. Findings from this study can help financial educators and advisors to deliver the right mix of financial knowledge to better financial choices and behaviors.
Article
This study examines associations between financial education and financial literacy among people with different levels of education and income using a large, national data set, the 2015 National Financial Capability Study. This study estimates whether financial education in high school, college, or through an employer, is associated with a person's financial literacy score. Results show that people who received any financial education are likely to have higher financial literacy scores compared to those without financial education. Financial education has larger predicted probabilities for those with lower education and income, suggesting that financial education is especially important for this demographic group. This research emphasizes a need to teach financial education to people whom previous research suggests lacks financial literacy the most.
Article
Financial therapy is used to address the psychological, emotional, and behavioral components involved in the process of learning and utilizing new financial literacy skills. This study describes the use of a manualized financial therapy financial therapy intervention, the Five-Step Model, as it is piloted in a group setting. Current economic theories support the use of an intervention model that differs from traditional financial literacy teachings. Behavioral economics and the Transtheoretical Model of Behavior Change is used as a foundation for the Five-Step Model. A case study illustrates the key principles and effectiveness of the intervention model. Reflections and feedback from the members of the group are provided, along with a discussion of implications and directions for further inquiry.
Article
This study presents a community-based financial literacy program offered to low-income families in the heart of Silicon Valley. Leveraging local financial institutions and organizations, it provided financial education and encouraged habit formation, hoping for lasting outcomes toward financial well-being. Program impact was assessed in the areas of financial knowledge gain, behavioral tendencies in financial decision-making, and self-reported personal finances. Participants showed significant improvement in key knowledge areas, with positive impact observed in behavioral tendencies such as financial goal setting. Improvements in financial outcomes were not significant. The results of this intervention illustrate that maintaining long-term impact and applying sophisticated evaluation methods present key challenges for community-based efforts focused on financial education.
Article
This article reviews the theories and literature in intrahousehold financial decisions, spousal partners and financial decision making, family system and financial decision process, children, and financial decisions. The article draws conclusions from the literature review and discusses directions for future research and educational programs. Most financial education and counseling takes place at the individual level, whereas financial decisions take place at household and intrahousehold levels. Family members, spouses/partners, children, and others play a key role in individuals' financial decisions. The article proposes the key programmatic implications for financial professionals and educators that need to be integrated into financial education and counseling. Understanding the unique dynamics of family financial decision making would help create effective educational and counseling strategies for the whole families. © 2017 Association for Financial Counseling and Planning Education.