Financial Education and Counseling—Still Holding Promise

Abstract

This article reviews the evaluation literature on financial education and counseling for adults in order to synthesize implications for research and practice. Most evaluations report positive impacts, but the findings are often small when compared with valid comparison groups. Many evaluations use self‐reported measures, measure outcomes over short time periods and cannot rule out selection bias due to nonrandomized designs, all of which may bias results. Although future research and practice in this field hold promise, more attention to theory‐based evaluations and further investment in randomized field experiments may be fruitful.

Training Social Workers in Personal Finance: An Exploratory Study

“…First, recognizing the contributions of the field of behavioral economics, financial behavior should be seen as complex and multidimensional. There is little evidence to suggest that financial education alone changes people's behavior (Caskey, 2006;Collins & O'Rourke, 2010;Fox et al, 2005;Hathaway & Khatiwada, 2008)-thus financial literacy may be a necessary yet insufficient condition for behavior change and improved financial well-being.…”

“…Evidence conceming financial education and financial counseling is mixed due to methodological shortcomings of research in this field (Fox et al, 2005;Hathaway & Khatiwada, 2008;Lyons, Palmer, Jayaratne, & Scherpf, 2006) and the lack of explicit theory (Collins & O'Rourke, 2010). Sherraden (2010) points out that financial counseling is offered in a variety of practice settings with inconsistent quality.…”

Financial Issues of African Americans

“…It has been found, in some research, where positive effects of a fi nancial education program on fi nancial knowledge were experienced, the benefi ts were consistent across race (Walstad, Rebeck, & MacDonald, 2010 ). Others contend that for fi nancial education programs to be more effective on knowledge and behavior there is a need to emphasize programming that is sensitive to the heterogeneity of target populations (Collins & O'Rourke 2010 ). Williams, Grizzell, & Burrell ( 2011 ) conducted an applied research case study of fi nancial education using a resource work booklet and supporting materials especially prepared for African Americans and Latin Americans.…”

Financial Capability and Asset Building: A Transformational Practice Framework

“…Financial capability has relied more heavily upon an individualistic view of economic actors, and focuses upon helping individuals to learn new skills, knowledge, and practices, often ignoring clients' social and economic contexts. Those working to help individuals gain financial knowledge have relied upon individually-focused interventions such as financial education (Collins & O'Rourke, 2009) and financial therapy (Archuleta & Grable, 2011). Conversely, the asset building field, which helps individuals and families to accumulate wealth through savings or investment (Sherraden, 1991), has focused more on structural theories, such as asset theory and behavioral economics, and has had relatively little to say about micro-level skills or theories (Despard & Chowa, 2010;Sherraden, Laux, & Kaufman, 2007 Scanlon & Sanders/FINANCIAL CAPABILITY 544 led to a lack of role clarity on the part of agency level staff tasked with the delivery of these programs.…”