Description of the programme

Existing evidence indicates that workplace-based financial education is a key mechanism for facilitating improvements in people’s financial behaviour. Workplace-based education initiatives that have been delivered as workshops or seminars have been shown to have small effects on participation in voluntary contribution banking accounts, although evidence suggests that these interventions need to be well-timed and can be expensive to deliver. Online education is one possible alternative, that could be completed at home or work.

Precision Information LLC provided an online education module to The Appleton Area School District in 2011. The module contained five topics:

• Getting started on investing;
• Basics of personal finance;
• Basics of investing;
• Basics of retirement planning;
• Additional ways to save for retirement.

121 individuals participated in the programme, with 55 completing all five modules.

The study

A team lead by J. Michael Collins, at the University of Madison-Wisconsin, conducted a randomised experiment to identify the impact of the online workplace intervention on participants’ financial knowledge and behaviours. The study’s researchers randomly assigned 1,396 employees into a treatment and control group. Of those assigned to the treatment group (n=717), 121 individuals agreed to participate in the programme. The control group comprised of 679 employees who were not offered the online financial education course.

All employees were invited to complete a 54-question baseline and follow-up postal survey, which covered respondents’ self-assessed financial knowledge, attitudes and self-reported behaviour. The study’s researchers incentivised people to respond to the survey by offering people the chance to win an Apple iPad. There was a 52% survey response rate (n=746), including half of the respondents from the entire treatment group (n=361) and 57% from the control group (n=385).

Key findings

• The study found that intervention had a small, but statistically significant, positive impact on employees’ self-assessed financial knowledge.
• Similar to the self-assessed financial knowledge of the treatment group, the research found that the intervention increased employees’ objective financial knowledge. It only had a small impact, but the findings were statistically significant.
• The study did not find any significant effects of treatment on the financial confidence of participants.

Points to consider

• Take-up rates of the programme were relatively low, which muted any potential effects.
• The study was conducted over a short period of time, in a context of school protests. It may have been that many participants were distracted by this and may not have focused on the financial education programme.
• The study only collected self-reported data (through the survey), which may be subject to bias. It could have been strengthened through the use of administrate data.

• The study’s population was a homogenous group of public school employees who were well-educated and financially stable. As the population works within a particular sector (education), in a certain geography (Appleton, US), and is of a certain demographic, the findings cannot be generalised to the wider working population.