Presentation Transcript

1. Financial Education & Account Access Among Elementary Students April 23, 2014 Brought to you by CFED and the Center for Financial Security at the University of Wisconsin-Madison
2. Our Presenters Kasey Wiedrich Senior Research Manager CFED Jennifer McHugh Community Relations Manager Royal Credit Union Laura Rosen OpportunityTexas Coordinator Center for Public Policy Priorities Louisa Quittman Director, Financial Education Office of Consumer Policy US Department of the Treasury Elizabeth Odders-White Associate Professor Wisconsin School of Business CFS Affiliate
3. Study aims to better understand how to provide children with the financial skills to become economically successful Focus on elementary-age students Rigorous examination of financial education combined with financial access
4. Financial Education + In-School Banking Eau Claire, Wisconsin Population, 2010: 65,883 Median household income, 2007-11: $42,226 Unbanked Households, 2009: 5.4% Economically Disadvantaged Students, 2011-12: 41% Amarillo, Texas Population, 2010: 190,695 Median household income, 2007-11: $44,769 Unbanked Households, 2009: 10.3% Economically Disadvantaged Students, 2011-12: 69%
5. Partners U.S. Treasury Department, Office of Consumer Policy CFED Center for Financial Security, University of Wisconsin-Madison Implementation Partners
6. Research Questions What is the impact of financial education and in-school account access, alone and in combination, on students: Financial Knowledge Attitudes towards savings and financial institutions Behavior, e.g. opening and using bank accounts
7. Financial Education 5 or 6 lessons from Financial Fitness for Life curriculum Content focused on Savings Account Use Defining income, expenses and savings Wants vs. needs, incentives and goals Explain budgets and savings plans Compare savings options and understanding interest 45-minute lessons taught by classroom teachers Teachers trained for 3 to 8 hours on curriculum and materials
8. 1st Year in 4th & 5th Grade Classrooms – Eau Claire Research Design Schools with In-School Branches 50% financial education 50% no financial education Student Follow-up Survey (in class): identical to baseline survey Control Group receives financial education Student Baseline Survey (in class): financial knowledge, attitudes and behavior Schools w/o In-School Branches 50% financial education 50% no financial education
9. Research Design 2nd Year in 4th Grade Classrooms – Eau Claire & Amarillo Schools with In-School Branches 50% financial education Student Follow-up Survey (in class): identical to baseline survey Follow-up Survey for Eau Claire 5th Graders (in class): received treatment 1 year previously as 4th graders 50% no financial education Student Follow-up Survey (in class): identical to baseline survey Control Group receives financial education Student Baseline Survey (in class): financial knowledge, attitudes and behavior Schools w/o In-School Branches 50% financial education 50% no financial education
10. Research Design Amarillo Pilot (Smarter Texans Save) “SEED” Deposit Schools with Happy State Branch (randomly assigned) 50% $25 “seed” deposit Offer of Happy State Bank Accounts 50% no $25 “seed” deposit
11. Established in 1993 Currently operate 27 school sites 17 elementary 5 middle schools 5 high schools 6 dedicated staff, 8 branch staff, 350 student team members 17,874 transactions last school year Video introducing School $ense
12. In-School Banking, Eau Claire Royal Credit Union School $ense Account Type: Joint ownership savings account Frequency: Open once a week during the school day Bank Transactions: Kids can make deposits and withdrawals at school branch Student Staffing: Student tellers work with RCU staff
13. Why we wanted to participate in the study Financial education in the classroom Need for research Staff development
14. In-School Banking, Amarillo Happy State Bank Kids’ Banks Account Type: Joint ownership savings account (also opened minor-only account for the pilot) Frequency: Every 2-3 weeks (once a week during study period) Bank Transactions: Kids can only make deposits at school branch Student Staffing: Student tellers work with HSB staff (timing of research didn’t allow for student staffing during the study)
15. Amarillo In-School Banking Take-Up Participation data is for study period, January 15 – June 7, 2013. Take-up percentages don’t include students at three elementary schools with existing Kids’ Banks. Total “Seed” deposits are for all 18 schools with Kids’ Banks.
16. Amarillo In-School Banking Take-Up Account Take-up by School Account take-up range: 20% - 60% On average, the same or higher take-up in schools with more economically disadvantaged students Account Type Child only: 26% Joint: 74% At two schools, majority of accounts were child only
17. Insights and Successful Practices to Operating an In-school Banking Program Marketing is key to student participation, but keep materials simple Campus administration and staff support is critical to program’s success Have school district market in-school banking program to students Offer accounts that meet the needs of all families
18. Amarillo Teacher Feedback Kids’ Bank: Nearly all positive feedback from teachers Students excited about saving & Kids’ Bank participation brought concepts taught to life Students’ Level of Understanding: Students initial level of understanding was very limited Items discussed in lessons should take into consideration students’ income levels
19. Results
20. Data
21. Sample Size & Results Overall Results Large effects of education on knowledge questions Moderate effects of in-school banking and education on attitudes Education and bank access boost bank account ownership by kids Effects persist
22. Financial Quiz Scores Increased with Education Financial education appears to produce a large improvement in financial knowledge—an increase in the number of correct questions between 1.8 and 2.0 Students with bank accounts show stronger effects in terms of changes in learning, but not randomly assigned No evidence that having a bank branch in the school has an added effect on learning
23. Attitudes About Financial Institutions Improved It’s Easy to Save Banks Are Useful Positive effects of education and having a branch in school on attitudes about saving and banks, with strongest effects from financial education
24. Increase in Being Banked from Education, Incentives Banking Status of Student Financial education increases the number of banked students by about 3.5% The likelihood of a student having a bank account was highly correlated with the presence of in-school financial services $25 incentive causes about an 18.1% marginal increase in students opening accounts
25. Net Bank Deposits Rising (Eau Claire) Education Net deposits were higher on average (by about $7.69) after education, but not significant statistically In-school banking access is related to students more actively using accounts
26. Persistence of Treatment Effects
27. Key Findings Education – Relatively brief educational intervention has impact on knowledge And it lasts at least from 4th to 5th grade Being banked intensifies the effect Banked students are likely different…but banks in schools and incentives facilitate account ownership Attitudes about financial institutions strongly influenced By education and even just having a branch in school Account use proved hard to measure stably
28. Policy and Practice Implications Classroom-based financial education can increase knowledge Requires support to implement but is feasible if strategically developed Potential of external support / community partnerships In-school banking access has direct and indirect impacts on attitudes about financial institutions and on having an account. Incentives to start an account are clearly helpful, but add to costs Financial institutions need guidance on children savings marketplace
29. Questions?
30. Resources Download the full report and briefs at: Treasury Notes blog http://www.treasury.gov/connect/blog/Pages/Promising-Hands-on-Financial-Education-Strategy.aspx CFS Publications http://www.cfs.wisc.edu/briefs/Financial_Education_and_Account_Access_Among_Elementary_Students-_Brief_April14(2).pdf CFED Inclusive Economy Blog http://cfed.org/blog/inclusiveeconomy/lessons_from_the_field_connecting_school-based_financial_education_and_account_access_in_amarillo_tx/ For materials used in the pilots, visit: OpportunityTexas, Smarter Texans Save http://opportunitytexas.org/about-us/current-initiatives/smarter-texans-save
31. Thank you for attending today’s webinar: Financial Education & Account Access Among Elementary Students This archived webinar and PowerPoint presentation will be available for viewing on the CFS and CFED websites. https://cfed.org www.cfs.wisc.edu/ Please contact HallieLienhardt hebennett@wisc.edu or 608-890-0229 with questions