Consumer education should start at a young age and receive reinforcement throughout adulthood. Early and ongoing education can build and strengthen knowledge, attitudes, and beliefs of young people as they progress to adulthood and engage in health and financial decision making. Although this study did not address efforts directed at youth, multiple interview participants conducting financial initiatives stressed the importance of providing formal financial education within schools, with the aim of preventing long-term problems such as debt, poor credit, and fraud. Financial education should still be situation-dependent and targeted. At a young age, the simple foundations of finances should be taught (e.g., adding, subtracting). In high-school and/or college, financial education related to credit cards, credit, and debt should be taught, as it is more relevant to consumers in that age group. While none of the interview participants brought this up specifically, using a theoretical framework to develop educational information or interventions could be of value as well. For example, using the Stages of Change Theory it may be beneficial to begin discussing savings and retirement with teenagers and young adults even though this subpopulation may not be considering long term savings or retirement (i.e., precontemplation). However, it may help to move this population from precontemplation to contemplating savings and retirement. The USDAs Financial Security Plan expanded its initial focus on older adults, to include all age groups once it recognized that adulthood may be too late to achieve optimal financial-planning outcomes. A participant affiliated with this initiative stated that early financial education is a necessity:
[It is necessary] to start as young as possible...the earlier you instill habits of financial responsibility, the better you can build it.
USDA interview participant
Interview participants from ACFs ORR also noted the importance of introducing financial education in schools. A participant from Treasurys MyMoney.gov reiterated that healthy financial behaviors, like healthy eating habits, should be emphasized early in an individuals life.
Many audiences, including low- and moderate-income groups, could benefit from financial education initiatives. Most financial education initiatives (14 federal, 6 private) included in this study targeted primarily low-income consumers, whereas health education initiatives had a broader reach and encompassed either individuals at risk for a health condition or specific groups, such as ethnic minorities, women, and rural populations. Many interview participants stated that there were mandates or regulatory reasons for such broad populations although some participants recognized the need for customizing information to specific populations. Certain health efforts such as CMSs Hospital and Nursing Home Compare Web sites and ASHs HealthFinder.gov aimed to provide information to far larger audiences, including informational intermediaries (e.g., family members, discharge planners, nurses, and social workers). In a similar manner, the Federal Reserves consumer education Web site targeted all consumers. Although these are Web-based initiatives and are therefore able to reach a wider audience with relative ease, multiple interview participants perceived a benefit in expanding financial education efforts beyond low-income audiences. As we discussed earlier, participants pointed out the need for formal school-based financial education targeting all young people. One participant also stated a universal need for greater financial awareness:
Financial education is really needed across the board. Its not just low-income families that need this. Other families and other people, even those who have money, are not necessarily good managers. People who are higher income, lower income, or just getting out of college all those people need to know how to make decisions.
ACF interview participant
The participant referred to the current financial and housing crisis by describing how uninformed decisions about mortgages made by individuals of all income levels were able to adversely affect the entire population. Financial education and assistance efforts can expand beyond their focus on low-income groups and recognize that poor financial decisions can originate from and affect a variety of audiences.
There is a demand for increased training and endorsement of standards for financial educators. Among providers of health care and health information, there exist numerous widely recognized degrees and certifications that attest to an individuals capability to serve as a trustworthy source of information. The Bureau of Labor Statistics cites an advanced degree in health education and Certified Health Education Specialist certification as examples of such designations (U.S. Department of Labor [DOL], Bureau of Labor Statistics, 2010). Advanced degrees such as an R.N., N.P., and M.D. are also generally considered by the public to represent standardized and skilled levels of health and medical training. Although similar advanced financial degrees exist such as Certified Public Accountant (CPA) and Certified Financial Accountant (CFA) these speak to an individuals ability to provide financial services and advice. Not all financial educators have these degrees, and individuals with these degrees are not necessarily perceived as financial educators by themselves or others. Low-income populations do not generally interact with these financial professionals. We did not learn about widely recognized degrees or certifications to demonstrate the ability to provide financial education. One interview participant described this challenge:
Its important to know that it takes skill to provide effective financial education and [the] coaching aspect is an important component. It takes training to create effective coaches and effective educators... There are some certifications for financial educators, but theres not one that is easily recognized as the certification.
ACF interview participant
An interview participant associated with EDs Adult Numeracy Instruction project expanded on the importance of appropriate training for educators. Although the initiative does not directly address financial education, it aims to provide teachers with evidence-based training necessary to ensure proper math instruction, which may include helping students develop numeracy skills. The participant described the programs focus on the way in which teachers introduce a particular topic to students, reinforce understanding of the topic, ensure independent or supported practice, promote transfer of knowledge to different situations, and reeducate when necessary. The participant went on to note that, in the absence of effective educators, good education resources will have limited effectiveness.
Approaches to addressing specific health behaviors can also tackle particular high-risk financial behaviors. Consumer behaviors surrounding certain risky financial- and health-related behaviors may share similar characteristics and underlying causes. These may include negative behaviors influenced by an individuals emotional or psychological state or proclivity for destructive actions. Health initiatives generally promote prevention and encourage healthy decision making by attempting to make consumers aware of the adverse effects of their risky behaviors, inform consumers about healthy choices, increase consumers confidence in their ability to achieve behavioral change, and address contextual issues, such as emotional or psychological conditions, that may increase risky behaviors. When asked about how health initiatives can inform financial ones, a participant from Treasury described this possibility:
For example, managing money and managing weight; sometimes there are emotions underlying both sides, so it would be important to learn about how to deal with those. There are people who dont have good spending habits and it may be that they do not have the financial education or literacy. It might be that they spend because they have psychological issues or [that] there is something in their lives that is affecting them, and spending a way to deal with those issues. The same goes for managing weight, for example, when its stress-related... I think there is a lot to learn from these, such as creating healthy habits early on healthy eating habits and healthy savings habits.
Treasury interview participant
The same goes for managing weight, for example, when it's stress-related... I think there is a lot to learn from these, such as creating healthy habits early on-healthy eating habits and healthy savings habits.
Initiatives to address risky or destructive financial behaviors need to incorporate knowledge, attitudes, and beliefs about finances. A Federal Reserve participant explained that consumers who engage in these behaviors may be suffering from a lack of confidence. This participant believes that financial literacy initiatives can adopt approaches to increasing consumer self-efficacy and confidence that are similar to the approaches that have been implemented in the health field. A participant from ACF echoed the importance that building consumer confidence plays in empowering individuals to make informed health decisions. As part of the overall goal to improve health literacy of Head Start parents, grantees implemented trainings for parents on ways to respond when their children fell ill. The participant discussed the trainings approach to building the parents confidence:
Parents are reporting that [they have] a lot more confidence in this area, which is probably the biggest thing. Theyre feeling much more comfortable and competent in terms of taking their children [to a doctor]... [The] ability to feel confidence and competent is huge. Feeling more comfortable dealing with the health care delivery system, feeling more confident to ask questions, better understanding the importance of preventive health...
ACF interview participant
Just as people can initiate exercise and proper nutrition practices at any age and must integrate these practices into their daily lifestyle, people can learn healthy financial behaviors and must practice them regularly in order to achieve success. A participant from the Federal Reserve described the way she uses health and nutrition examples when speaking about financial education initiatives:
People dont get into credit card problems overnight and wont get out of them overnight, and people dont get obese overnight and wont get thin overnight either.
Federal Reserve interview participant
The participant noted that individuals undergo regular checkups to monitor health indicators such as cholesterol, blood sugar, and blood pressure. She felt that similar financial checkups could be promoted to monitor spending regularly, net worth, cash flow, and other factors relating to finances. A participant from the Financial Literacy Center echoed the relevance of using an ongoing, step-by-step approach to promoting positive financial behaviors. For example, goals such as quitting smoking or eating healthier foods are usually achieved in steps, rather than through a one-time behavior change. She noted that a similar strategy of promoting realistic, tangible sequential actions can be applied to financial literacy. The participant described how the Financial Literacy Center used this approach in developing a financial-planning video to promote saving for retirement among low-income groups.
They designed a very simple seven-step planning aid, [consisting of] a step-by-step description of how you enroll in a supplementary retirement account They provide precise steps on how to translate something into action to change behavior. To make sure that information translates into behavior, [it] needs to provide specific direction. [An initiative] needs to be very specific about how people can achieve an objective. [It is] important to break down important decisions into small steps. A lot of the health literature is a series of steps, such as how to go on a diet or eat less. [It] cant tell people, Starting tomorrow, youre going to save $1,000 per month. [It] must do it in steps.
Financial Literacy Center participant
One private initiative emphasized similarities in approaches to successfully achieving financial and health behavior change. ISU Extensions Small Steps to Health and Wealth focuses on motivating individuals to improve their health and financial situation by exploring behavior change strategies common to both disciplines. These include setting goals and limits, charting steps necessary to achieve a goal, practicing moderation (e.g., in eating and spending), partnering with other individuals to achieve targets, and monitoring individual progress. The program also addresses challenges commonly faced by individuals pursuing financial or health behavior change, such as psychological barriers, motivation issues, and difficulties upholding their commitment to a goal.
Audiences with limited English proficiency can benefit from materials and trainings specific to them. Health initiatives were more likely than financial initiatives to target audiences with limited English proficiency, and participants often noted the availability of materials and tools in languages other than English. Some participants indicated that certain web-based financial education materials for example, information resources and interactive tools on MyMoney.gov are available in multiple languages. A participant from the Federal Reserve acknowledged the need for more materials on the agencys consumer information web-site that are accessible to non-native English speakers:
Currently a lot of materials [on the web-site] are translated into Spanish, and they recognize the need in the future for other languages like Chinese, Hmong, or Russian as immigrants are often in the low- to moderate-income bracket... They are moving in that direction.
Federal Reserve interview participant
However, participants from most programs that involved direct or in-person financial education or assistance did not reference resources for audiences with limited English proficiency. A participant from Treasury elaborated on why the availability of such resources is important:
The GAO is doing a study about financial literacy and English proficiency, and the connection between the two. If youre going to talk about money, of course youre going to want to speak in your own language if English is your second language.
Treasury interview participant
Health initiatives often target limited English proficiency and non-English-speaking audiences through media campaigns that use such outreach strategies as foreign language advertising, mailings, and public service announcements.