NEFE Salon Report

First in Grantee Salon Series

In late 2008, NEFE brought together project principals and team members from our various grants to discuss the projects in progress and share discoveries about new research findings. Grantee participants came from the University of Wisconsin-Madison; the Institute for Socio-Financial Studies; University of Arizona; and University of Florida. Learn more about what was discussed below.

Reason for the Salon Series

Predicated on the salons commonly associated with French literary and philosophical gatherings of the 17th and 18th centuries, NEFE initiated its grantee salon series to provide a forum to share discoveries and augment impact of preliminary findings as a means of promoting enlightenment about new research findings. Participants provided the line of inquiry for the informal agenda. To facilitate dialogue during the face-to-face gathering, a conference call prior to the Salon provided an overview of each project. 

Overview of Grant Projects

The Formation of Positive Financial Behaviors among Young Adults and the Effects on Their Life Successes

Soyeon Shim, Ph.D. at the University of Arizona: Her grant formally titled “The Formation of Positive Financial Behaviors among Young Adults and the Effects on Their Life Successes” was branded as the APLUS campaign (Arizona Pathways to Life Success for University Students) to enhance attraction among the student body.

Social Influence and Consumer Financial Behavior: Going Beyond Financial Facts

Lois Vitt, Ph.D., founder of the Institute for Socio-Financial Studies: The grant, titled “Social Influence and Consumer Financial Behavior: Going Beyond Financial Facts,” dug deep into interdisciplinary research to understand the environment in which people make their financial decisions.

Financial Management Practices of College Students from States with Varying Financial Education Mandates

Michael Gutter, Ph.D., University of Florida: Titled “Financial Management Practices of College Students from States with Varying Financial Education Mandates,” Gutter’s research included a thorough review of financial literacy K-12 requirements for all 50 states and the District of Columbia. Looking at each state’s level of standards and requirements for coursework and testing led to the development of six distinct categories. The final report will analyze respondent feedback with their home state’s category of financial literacy to establish benchmarks.

Financial Issues and Personal Finance Teaching Capacity among K-12 Educators: Research and Recommendations for Action

Wendy Way, Ph.D., University of Wisconsin-Madison: This grant works to understand the capability of new teachers to manage their personal finances as they enter the workforce. Its formal title is “Financial Issues and Personal Finance Teaching Capacity among K-12 Educators: Research and Recommendations for Action.” Although not its formal title, NEFE refers to Way’s research as the “Teach New Teachers” (TNT) project because a NEFE roundtable held in April 2006 of the same name instigated the research. The TNT roundtable convened representatives of university programs that offered or had the potential to offer preparation for teachers of personal finance. This meeting identified key concepts and an initial plan for gathering information potentially to inform further efforts to prepare both current and future K-12 teachers of personal finance.

Noticing Patterns

Funders have a unique vantage point to observe distinctive relationships among the variety of research projects in progress at any given time. NEFE’s Grants & Research department noticed that behavioral models being developed by grantees led by Shim, Vitt, and Gutter explained the overwhelming effect social and psychological factors have in financial decisions — often to the exclusion of rational, objective decision making. Preliminary findings from a fourth project led by Way offered data remarkably consistent with Gutter’s and Shim’s findings about young adult financial literacy and behaviors.

NEFE decided the similar characteristics in these active research projects were too important to ignore. The Grants and Research team asked each of the principals if they would be interested in sharing and learning about one another’s work. The response was unequivocally affirmative. NEFE scheduled the event at its Greenwood Village office in summer 2008. 

Participants in the Salon

The above-mentioned grantees all attended, as well as Allen Phelps, Ph.D., professor at the University of Wisconsin-Madison and Michael Staten, Ph.D., director of the Take Charge Institute at University of Arizona. NEFE participants included Ted Beck, president and CEO; John Parfrey, director of the High School Financial Planning Program® (HSFPP); Brent Neiser, director of Strategic Programs and Alliances; Patricia Seaman, director of Marketing and Communications; Paul Golden, Marketing and Communications project manager; and the Grants & Research team including Mare Canfield, director; Amy Hartenstine, project manager; Sadie Sullivan, associate; and Londell Jackson, assistant director who also coordinated the event.

Salon Presentations

Behavioral Factors in the Grants

The significance of non-objective factors on financial decisions surfaced in all projects, even those whose main objective was to measure the relationship between financial education and financial behaviors. While no one argued the importance of financial knowledge, everyone also agreed that their financial behavior models required scrutiny in the context of variables such as demographics, financial resources, attitudes, emotions, and social learning.

Practical and Policy Implications

  • Although none of the researchers had completed their work at the time of the Salon, several themes began to emerge.  
  • On the whole, the majority of college students in both Shim’s and Gutter’s studies can handle their money with no or few risky behaviors. Troublesome or risky behaviors among students seem to cluster around specific demographic, income, and psycho-social issues in combination with lack of financial knowledge. Understanding these triggers for risky behaviors could provide the key to targeting educational outreach and policy formation where it’s needed most.
  • Subjectively, survey respondents tend to rate their own financial knowledge both higher than their peers and higher than their scores indicate on an objective financial literacy test.
  • Attitudes about the importance of financial literacy and confidence about managing personal finances has an impact on the interest in and ability to teach it.
  • Providing objective financial knowledge as a goal of financial education programs is inadequate to counter the countless social and psychological factors that affect financial behaviors and decisions. Financial educators and policy makers likely will need to deliver and support holistic interventions in order to have any long-term, measurable effects on Americans’ financial behaviors.

Advancing Knowledge and Innovation

Each project on its own has strong potential to achieve innovations of significance for broad segments of our society. Collectively, the findings offer insights that corroborate the need for revising financial education interventions from both program and policy standpoints. NEFE asked Salon participants to identify opportunities to enhance use of the results. 

  • The Salon made it possible for each researcher to have firsthand knowledge of other studies that further support his/her findings. Each will share within their respective networks the work underway by the others.
  • All participants will present their findings at conferences whose audiences include other researchers, policy makers, educators, counseling professions, and professionals of other disciplines. NEFE will support participants’ efforts by making their final reports available on its website.
  • Participants encouraged NEFE to utilize its relationships in community-based programs, other nonprofits, policy networks, etc. to share findings one-on-one and in meetings.
  • The researchers will pursue publication in scholarly and professional publications. Participants encouraged NEFE to use its media contacts — both consumer and trade — to disseminate more broadly findings in ways that are useful to individuals and financial services professionals.

Participants of the first Salon commended NEFE for providing a fresh, informal approach to delve into topics of interest with researchers they may not otherwise have had opportunity to engage in conversation. As one might expect from a gathering of expert researchers, a good share of the initial inquiry was about where project data came from, how it stacked up with national statistics, and how the methodologies compared. However, by the close of the afternoon, all participants felt inspired with a new sense of enthusiasm about their work and the practical implications of the presented information on the field of financial education.

Next Steps

Encouraged by the participants’ expressions about the value of the Salon experience, NEFE plans to hold a second Salon in 2009 to bring together key players in the TNT project including Colorado State University, Iowa State University, North Dakota State University, University of California-Fullerton, University of Nebraska, University of Wisconsin-Madison, and Virginia Polytechnic Institute along with strategic implementers, policy makers, and others with strong interest in achieving excellence in K-12 financial education.