Description of the programme

The aim of the intervention was to examine the effectiveness of a financial education programme delivered in the workplace.

A publishing employer undertook a needs assessment across the workforce prior to the start of the programme, to determine the specific topics to be taught. Following this, the employer collaborated with the financial education provider Money Management International to develop a year-long programme of educational initiatives addressing the areas identified by the needs assessment.

The financial topics covered by the programme fell into two categories: basic financial management and retirement/investment strategies.

Money Management delivered specific initiatives according to theme, which ran for a number of sessions over a course of weeks (for example, ‘Money Basics’ – 6 hours divided between 90-minute sessions & the ‘Spotlight Series’ – ten 60-minute courses). The education provider offered courses both during and outside of working hours.

Money Management offered both online information and face-to-face on-site group workshops to the participant employees. 97% of participants took part in the financial education workshops focused on retirement; 68% of participants completed financial education workshops that covered basic money management concepts.

The study

Prawitz and Coharthas published an independent impact evaluation of the programme in 2010/11. The evaluation used a quasi-experimental design, which included a comparison group of employees who did not participate in the financial education programme. The evaluators used statistical methods to minimise the impact of any differences between the profiles of the two groups. They undertook pre-testing and post-testing for both the participant and the comparison group. They collected pre-test data in April and May 2010, and collected post-test data around a year later.

The evaluators measured the programme’s impact in relation to:

• Perceived financial wellbeing
• Savings ratios (the proportion of income not spent)
• Frequency of negative financial behaviours
• Likelihood of change among the following actions: budgeting, reviewing asset allocation strategies, retirement contributions, obtaining or updating life insurance plans, and obtaining or updating estate planning documents

Key findings

The evaluation found positive impacts in relation to the following outcomes:

• Participants’ financial wellbeing scores (measured using the eight item Personal Financial Wellness Scale), increased after the programme. However, the comparison group’s scores also increased over this period and the difference between the two groups’ increases was not statistically significant.

• Participants in the programme were nearly twice as likely as non-participants to have started or updated a budget.
• While saving ratios increased among both programme participants and non-participants, a slightly higher increase was observed among those who received the financial education.
• There was a decrease of 32% in negative financial behaviours (for example, late bill payment) amongst the participants.
• Employees who took part in the programme were more than one and a half times more likely to report having increased their retirement contributions than the non-participants.

Points to consider

• The needs assessment conducted prior to the study helped increase interest and participation in the programme. The provider tailored the financial education programme according to the needs assessment results so that employee needs, rather than employer needs, informed the programme design.
• Each participant who completed the pre-test received a personalised report with a financial wellness score and customised action plan. The employer also provided an incentive to participate in the pre-test by offering Wellness Points toward an insurance premium discount for completion of the pre-test survey questionnaire.

Full report

Full research report