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Our Philosophy

NEFE focuses on high-quality financial education through robust research, decision-making tools and reliable interventions. We believe education can help people navigate the financial system as it exists. However, numerous factors within and outside one’s control influence an individual’s ability to apply—or not apply—education to specific situations. Policy and regulation, socioeconomic status, availability of financial services, economic conditions, and subjective perception of economic outcomes are just a few of these influences. Consequently, education alone cannot create financial well-being.

NEFE acknowledges the limits of financial education. Alone, it is not enough to overcome the racial wealth gap, gender pay inequality, banking deserts, loss of the primary breadwinner or other barriers to financial capability. As a field, it is our responsibility to accept that education is not a silver bullet that creates financial well-being—and to correct others who define it as such.

NEFE strives to contribute its expertise in research, education, evaluation and thought leadership to the field of financial capability. By leading and encouraging best practices and knowledge-sharing, we’re committed to improving the effectiveness of financial education and raising awareness of the other factors which affect the achievement of financial well-being for all Americans.

NEFE is committed to leading and encouraging collective impact to improve financial capability. We do this at:

  • The organizational level. Our programs and initiatives serve a unified purpose to meet educational needs through every stage of life.
  • The financial capability field level. We break new ground in thought leadership, research and programs, and learn from others who are similarly pioneering new ideas and evaluating results.
  • The financial well-being model level. We ensure that our education programs incorporate the Five Key Factors for Effective Financial Education and encourage other financial education programs to include these factors.

Although outside the scope of our mission, we recognize consumer protection, regulation and choice architecture influence a person’s decisions and behaviors. Additionally, we understand many other factors exert influence including environment, education, opportunity, internal and external setbacks, behaviors, personal networks and public policies.

Speaking With a Unified Voice

NEFE aims to standardize terms used in describing our work and to use them distinctly, not interchangeably.

  • Financial education: a systematic approach to cultivating financial knowledge and decision-making skills. The Five Key Factors for Effective Financial Education imply the application of appropriate pedagogy, learning objectives and assessment techniques, as well as being of adequate duration and structure to allow the learner to incorporate new knowledge into their existing schema.
  • Financial information: a variety of tools, resources and activities—often used in self-directed inquiry—that inform the individual about a topic or decision. This can, and should, be used as part of a financial education program or initiative, but on its own does not constitute education. Examples include one-off or small-dose lessons not part of a broader program or curriculum, articles or reference resources, tips and tricks, calculators, and decision aids.
  • Financial capability: an individual’s ability to act in their own self-determined best interest—impacted by knowledge, behaviors, general skills and abilities, and a host of other exogenous factors.
  • Financial well-being: the individual’s ultimate goal—it is self-defined but major elements include their personal economic outcomes, subjective perception of their economic outcomes, their decisions and behaviors, and satisfaction with their current situation.

 

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