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
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Our Presenters
Kasey Wiedrich
Senior Research Manager
CFED
Louisa Quittman
Director, Financial Education
Office of Consumer Policy
US Department of the Treasury
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Jennifer McHugh
Community Relations
Manager
Royal Credit Union
Laura Rosen
OpportunityTexas Coordinator
Center for Public Policy Priorities
Elizabeth Odders-White
Associate Professor
Wisconsin School of Business
CFS Affiliate
FINANCIAL EDUCATION AND ACCOUNT
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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
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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%
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Partners
• U.S. Treasury Department, Office of Consumer Policy
• CFED
• Center for Financial Security, University of WisconsinMadison
• Implementation Partners
Eau Claire
• Eau Claire Area School District
• Royal Credit Union
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Amarillo
• Opportunity Texas
• Texas Council for Economic
Education
• Amarillo Independent School
District
• Happy State Bank
FINANCIAL EDUCATION AND ACCOUNT
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Research Questions
What is the impact of financial education and inschool account access, alone and in combination,
on students:
– Financial Knowledge
– Attitudes towards savings and financial institutions
– Behavior, e.g. opening and using bank accounts
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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
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Research Design
1st Year in 4th & 5th Grade Classrooms – Eau Claire
Schools with In-School
Branches
50% financial
education
50% no financial
education
Student Follow-up Survey (in
class): identical to baseline
survey
Student Baseline Survey (in class):
financial knowledge, attitudes and
behavior
50% financial
education
Control Group
receives financial
education
50% no financial
education
Schools w/o In-School
Branches
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Research Design
2nd Year in 4th Grade Classrooms – Eau Claire & Amarillo
Schools with In-School
Branches
50% financial
education
50% no financial
education
Student Baseline Survey (in class):
financial knowledge, attitudes and
behavior
50% financial
education
Student Follow-up Survey (in
class): identical to baseline
survey
Student Follow-up Survey (in
class): identical to baseline
Follow-up Survey for Eau
survey
Claire 5th Graders (in class):
received treatment 1 year
previously as 4th graders
Control Group
receives financial
education
50% no financial
education
Schools w/o In-School
Branches
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Research Design
Amarillo Pilot (Smarter Texans Save)
“SEED” Deposit
Schools with Happy State
Branch
(randomly assigned)
Offer of Happy State Bank
Accounts
50% $25 “seed”
deposit
50% no $25 “seed”
deposit
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• 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
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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
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Why we wanted to participate in the study
• Financial education in the classroom
• Need for research
• Staff development
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In-School Banking, Amarillo
• Happy State Bank Kids’ Banks
– Account Type: Joint ownership
savings account (also opened minoronly 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)
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ACCESS
Amarillo In-School Banking Take-Up
Total Accounts Opened (all grades)
615
Account Take-up (4th grade)
38%
With $25 “Seed”
Deposit Offer
43%
Without $25 “Seed”
Deposit Offer
32%
“Seed” Deposits Distributed
254
Value of “Seed” Deposits Distributed
$6,350
Schools Continuing Kids’ Bank in 201314
15 (83%)
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.
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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
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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
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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
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RESULTS
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Data
Knowledge
• Financial Quiz Score: The number of questions answered correctly out of 13 questions
Attitudes
• Spend Money Immediately: 5-point scale how often they find it hard to avoid spending
money immediately
• Easy to Save: 5-point scale how often they find it easy to save money
• Saving is for Adults: 5-point scale how often they feel that saving money is only for adults
• Banks Useful to You: 5-point scale the degree to which they believe that banks offer services
that are useful to them
Banking Activity
• Banked: Students report whether or not they have a bank account in their own name
• Net Deposits: Total amount of money that is deposited into the account net of the total taken
out of the account
• Active Account Use: Number of distinct occasions on which money is deposited or withdrawn
from the account
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Sample Size & Results
Sample Size
Eau Claire
Amarillo
Total
No Financial Education
320
285
605
Financial Education
380
418
798
Total
700
703
1,403
•
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
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Financial Quiz Scores Increased with Education
8.50
8.00
8.00
7.50
7.50
7.00
7.00
6.50
6.50
6.00
6.00
5.50
5.50
5.00
5.00
Baseline
No Financial Education (605)
•
•
•
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Follow-up
Financial Education (798)
Baseline
No Bank (677)
Follow-up
Bank in School (731)
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
FINANCIAL EDUCATION AND ACCOUNT
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Attitudes About Financial Institutions Improved
It’s Easy to Save
Banks Are Useful
3.90
4.20
3.85
4.10
3.80
4.00
3.75
3.70
3.90
3.65
3.80
3.60
3.70
3.55
3.50
Baseline
No Financial Education (581)
Follow-up
Financial Education (768)
3.60
Baseline
No Financial Education (578)
Follow-up
Financial Education (763)
• Positive effects of education and having a branch in school on attitudes
about saving and banks, with strongest effects from financial education
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Increase in Being Banked from Education, Incentives
Banking Status of Student
0.70
0.80
0.75
0.65
0.70
0.65
0.60
0.60
0.55
0.55
0.50
0.50
0.45
0.40
0.45
0.35
0.40
0.30
Baseline
No Financial Education (584)
•
•
•
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Follow-up
Financial Education (775)
Baseline
No Bank (658)
Follow-up
Bank in School (706)
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
$25 incentive causes about an 18.1% marginal increase in students opening accounts
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Net Bank Deposits Rising (Eau Claire)
Net Deposits by Week - Eau Claire
3-week moving average ($)
30
25
20
15
10
5
0
0
5
10
15
20
25
30
35
40
-5
-10
Education
-15
• 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
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Persistence of Treatment Effects
Outcomes for the Treatment Group
Net Deposits
1.50
$14.00
1.40
$12.00
1.30
$10.00
1.20
$8.00
1.10
$6.00
1.00
0.90
$4.00
0.80
$2.00
0.70
Baseline
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First Follow-up
Second Follow-up
Quiz Score (13pt)
Student banked
Spend money immediately (5pt)
Easy to save (5pt)
Saving is for adults (5pt)
Banks useful to you (5pt)
$0.00
Before
Control
Immediately
After
Long After
Treatment
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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
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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
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Questions?
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Resources
Download the full report and briefs at:
• Treasury Notes blog
http://www.treasury.gov/connect/blog/Pages/Promising-Hands-on-Financial-EducationStrategy.aspx
• CFS Publications
http://www.cfs.wisc.edu/briefs/Financial_Education_and_Account_Access_Among_Elementa
ry_Students-_Brief_April14(2).pdf
• CFED Inclusive Economy Blog
http://cfed.org/blog/inclusiveeconomy/lessons_from_the_field_connecting_schoolbased_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
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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 Hallie Lienhardt
hebennett@wisc.edu or 608-890-0229 with questions
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