There are recognized best practices to developing, deploying and sustaining financial literacy programming outlined in the National Financial Capability Strategy; yet they are often ignored.
The recent economic crisis intensified the efforts of organizations and governments push to review financial education strategies and share viable standards by which financial education programs may be judged.
But among the vast array of programs that have cropped up in the past decade, few – if any – can claim to draw upon solid empirical evidence of best practices for financial education. This failure can be attributed in part to a shortage of rigorous research defining those financial education best practices.
Recently, however, the National Financial Educators Council (NFEC) analyzed the growing evidence base and identified a foundation for designing effective financial literacy programming. This set of best practices was synthesized into the NFEC’s National Financial Capability Strategy report, and is summarized in this article.
The National Financial Capability Strategy report presents some of the overall strategies identified by various agencies to guide nationwide financial literacy promotion.
National Financial Capability Strategy Background
The NFEC analyzed 48 recent proceedings documents, agency reports, conference presentations, and peer-reviewed research articles to clarify key points of agreement and topics for future research. From our analysis three common themes emerged that might usefully underpin national standards for promoting financial literacy: education, awareness, and sustainability.
Best practices for education consider not only content but context – that is, delivery methods, provider training, and evaluation tools are equally as important as the material being taught. Program awareness is critical because no program will be effective if it fails to reach its target audience. And sustainability is the key to maintaining program results over the long term.
Key Takeaways from International Research
Materials from the U.S. plus five other countries, along with documents from the International Forum for Investor Education (IFIE), International Monetary Fund (IMF), Organisation for Economic Co-operation and Development (OECD), and World Bank were reviewed for this analysis. View the key points below:
The NFEC has leveraged the latest research and data since its inception. Our business model has been developed by gathering research, interpreting the data, developing products and services that aligns with the research, testing and modifying the material and then making evidence-based solutions available for others to use. To further the financial literacy movement and promote best practices among the industry, the NFEC has open-sourced the research our business model is based on. We encourage other organizations to adopt best-practices outlined in this report to help propel FLEC subjects (financial literacy, entrepreneurship and career education) beyond the tipping point.
National Financial Capability Report References
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