Financial education for adults

Adult financial education programs often cover topics such as basic budgeting, bank use, and credit management. Specialized education programs can focus on preparing for divorce, bankruptcy, credit building and counseling, homeownership, retirement, or other relevant topics. Financial education may be provided one-on-one or in groups, in person, over the phone, or online. Programs can be offered through non-profit organizations, for-profits, government entities, and employers, and often serve individuals with lower incomes.

Expected Beneficial Outcomes (Rated)

  • Improved financial literacy

  • Increased financial stability

Evidence of Effectiveness

There is insufficient evidence to determine whether financial education for adults improves financial literacy, increases positive financial choices, or increases financial stability (Fernandes 2014, ). Available evidence suggests that financial education programs may lead to small positive changes in financial decisions and financial literacy (Fernandes 2014, Collins 2012, Collins 2010b), but effects vary widely (). Education in the workplace related to retirement may also increase retirement savings ().

Experts suggest that programs designed for specific audiences, focused on a distinct topic, and delivered just before a relevant financial event may be more likely to change participants’ financial behavior than other programs (Hathaway 2008). A large study of military personnel and small studies examining programs that support survivors of domestic abuse, individuals participating in an Individual Development Account (IDA) program, and low income individuals living in subsidized housing appear to support this recommendation (, , , Collins 2012). However, additional evidence is needed to confirm effects.

Impact on Disparities

Likely to decrease disparities

Implementation Examples

Several government agencies provide financial tools or curriculums. The Financial Literacy and Education Commission of the United States Department of the Treasury, for example, has a national financial education website, (US Treasury-Resource center). Also, the Federal Deposit Insurance Corporation (FDIC) offers Money Smart, a financial education curriculum that can be used by individuals, financial institutions, or other organizations (FDIC-Money smart). Private non-profits, such as the National Endowment for Financial Education, provide financial education resources and training tools for youth and adult learners at all income levels (NEFE).

Implementation Resources

FDIC-Money smart - Federal Deposit Insurance Corporation (FDIC). Money Smart: A financial education program. - US Department of the Treasury.

NEFE - National Endowment for Financial Education (NEFE).

CFPB - Consumer Financial Protection Bureau. Resources for financial educators. - Federal Trade Commission (FTC). Consumer protection basics. - National Credit Union Administration (NCUA). Financial Literacy Tools & Resources.

Citations - Evidence

* Journal subscription may be required for access.

Collins 2012 - Collins JM. The impacts of mandatory financial education: Evidence from a randomized field study. Journal of Economic Behavior & Organization. 2012;95:146-158.

Collins 2010b - Collins JM, O'Rourke CM. Financial Education and Counseling-Still Holding Promise. Journal of Consumer Affairs. 2010;44(3):483-498.

Fernandes 2014 - Fernandes D, Lynch JG, Netemeyer RG. Financial literacy, financial education, and downstream financial behaviors. Management Science. 2014:1-23.

Grinstein-Weiss 2015* - Grinstein-Weiss M, Guo S, Reinertson V, Russell B. Financial education and savings outcomes for low-income IDA participants: Does age make a difference? Journal of Consumer Affairs. 2015;49(1):156-185.

Hastings 2013* - Hastings JS, Madrian BC, Skimmyhorn WL. Financial literacy, financial education, and economic outcomes. Annual Review of Economics. 2013;5(1):347-373.

Hathaway 2008 - Hathaway I, Khatiwada S. Do financial education programs work? Federal Reserve Bank of Cleveland. 2008: Working Paper.

Reich 2015* - Reich CM, Berman JS. Do financial literacy classes help? An experimental assessment in a low-income population. Journal of Social Service Research. 2015;41(2):193-203.

Xiao 2016* - Xiao JJ, O’Neill B. Consumer financial education and financial capability. International Journal of Consumer Studies. 2016;0.

Skimmyhorn 2016* - Skimmyhorn W. Assessing financial education: Evidence from boot camp. American Economic Journal: Economic Policy. 2016;8(2):322-343.

Hetling 2015* - Hetling A, Postmus JL, Kaltz C. A randomized controlled trial of a financial literacy curriculum for survivors of intimate partner violence. Journal of Family and Economic Issues. 2015.

Citations - Implementation Examples

* Journal subscription may be required for access.

FDIC-Money smart - Federal Deposit Insurance Corporation (FDIC). Money Smart: A financial education program.

NEFE - National Endowment for Financial Education (NEFE).

US Treasury-Resource center - US Department of the Treasury (US Treasury). Resource center: Financial literacy and education commission.

Date Last Updated

Sep 12, 2016