youthmoney

How do you measure the effect of financial education on young people.

With difficulty.

That’s the dominant thought as you read through an “evidence of impact” study just published by the Financial Services Authority.

It’s a longish document that presents an overview of financial education evaluations. Two things stand out.

• Those in the business of financial education believe that evaluation matters. If you can’t measure it, it ain’t happening. You must have evidence that what you are doing has an impact on young people’s behaviour. If not, it is pointless committing resources to it.
• There isn’t much evidence around. Evaluations are thin on the ground. What evidence there is isn’t particularly robust.

Anyway, the Financial Services Authority and the national strategy for financial capability are still plugging away. That’s to their credit. As is the fact that young people not in education, employment or training (neet) are one of the target groups.

Meanwhile, here’s a short form of some relevant highlight:

Young people do not acquire a lot more financial knowledge from education. A Jump$tart survey in the US was one of the few to measure knowledge. It found that teenagers who received personal finance education do not appear to be any more knowledgeable than those who have not. Expect rapid increases in knowledge among much younger children. But not among teenagers.

A lot of stuff happening in young people’s financial lives makes the impact of financial education pretty hard to identify. As teenagers become adults, they start to gain access to credit and have larger incomes and responsibilities to manage. That overwhelms any changes in behaviour as a result of financial education. If you want to measure the success of initiatives aimed at young adults you must have a sensible control group.

For neet young people to learn about financial topics such as budgeting, it helps if a small number of messages are repeated on different occasions. It is also important to have trusted adults working with this group of young people.

A range of delivery methods are needed to train youth work professionals in financial education.

Evidence of impact: An overview of financial education evaluations (link straight to pdf) was written by Adele Atkinson at the Personal Finance Research Centre, University of Bristol.