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A History of NEFE’s Personal Finance Ecosystem

The Personal Finance Ecosystem is an evolving framework that was first conceptualized by NEFE in early 2019 to synthesize observations from research and practice across the financial well-being field. Specifically, NEFE examined how financial education fits within the broader context of our field and used the framework to facilitate this conversation.

With consultation from the field, the first version evolved to a second version—in the shape of a multi-layered pyramid—later that year. Since then, NEFE has observed how people understand and interact with the model; collected extensive, evolving feedback; and field-tested various concepts, visuals, and phrasing with individuals working in areas across the ecosystem. We arrived at a third version in late 2021 and released it in early 2022.

Key updates to the newest version

First, and most importantly, is the shape of the visual. Perhaps the biggest misunderstanding of the pyramid was the suggestion that financial well-being is a destination. The updated version seeks to remove implications of hierarchy and better communicates that financial well-being is not a point of arrival: it is an ever-present state, experienced by every person, that fluctuates over time.

Similarly, financial well-being is influenced by a set of core elements within three main factors: Foundational Factors, Financial Knowledge and Access, and Financial Actions and Outcomes. While these core elements are mostly the same across versions, we made several additions and altered some of the original language.

  • We added Mindset and Available Choice set to the Financial Actions and Outcomes cycle.
  • We replaced Idiosyncratic Factors with Values and Beliefs and placed them within Foundational Factors.
  • We elevated Family and Culture, as well as Socioeconomics and Geography, to be visually represented on the model within Foundational Factors. This highlights the importance of economic inequality and cultural factors within the Ecosystem.
  • We revised language to be more inclusive (e.g., being intentional in the use of words such as ability and capability) and more intuitive to those outside of our field (e.g., Shocks are now Unexpected Events).

Finally, we’ve expanded the number of Catalysts for Change present in the second version. In addition to Knowledge Influencers and Behavior Influencers, we now include Structural Policy Changes and Social and Material Supports to recognize the range of individuals and organizations helping people to live their best financial lives.

Previous versions of the Personal Finance Ecosystem are available for reference and can be found using the links below:

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