Interventions designed to improve financial capability: A systematic review

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Abstract

This systematic review assesses the state of research on interventions that combined financial education and a mainstream financial product or service (“financial capability interventions”). It examines the financial behaviors and financial intervention outcomes. The review summarizes evidence from 63 reports from 24 unique studies. The studies spanned the years 2004-2020 and were all conducted in the USA. The majority of the studies were randomized control trials. Data were collected on financial behavior and financial outcomes of the study participants using unstandardized instruments and included self-reported and administrative data. Behavior changes included bank or retirement account opening, asset purchase, savings rate, budgeting and retirement savings rate. Financial outcomes included savings amount, credit score, debt amount, asset value and retirement savings amount. Data is sparse about whether participants’ financial behaviors and/or financial outcomes are improved. Many studies had important methodological weakness, and a high or unclear risk of bias. There is a lack of strong evidence about the effectiveness of financial capability interventions. Better evidence is needed about the effectiveness of financial capability interventions to guide practitioners. Policy actors that seek to facilitate increased financial capability through the interventions included in this review need a stronger evidence foundation.

Citation

Relevant Evidence Summaries

The evidence was reviewed and included in the following summaries: 

What works to improve people’s financial capability?

Limited but strong evidence supports financial capability interventions. Studies with low-income populations find that financial capability interventions lead to numerous positive outcomes such as increased income and savings, better job placement and retention, higher credit scores, and progress toward financial self-sufficiency.

About this study

AGE: Adults

DIRECTION OF EVIDENCE: No evidence about impact

FULL TEXT AVAILABILITY: Free

GENDER: All

HOST COUNTRY: United States

HOST COUNTRY INCOME: High

INTERVENTION DURATION: Various

INTERVENTION: Financial capability intervention

OUTCOME AREA: Economic Empowerment

OUTCOME AREA: Financial Capabilities

REGION OF ORIGIN OF PARTICIPANT(S): North America

STRENGTH OF EVIDENCE: Strong

TYPE OF STUDY: Systematic review

YEAR PUBLISHED: 2022

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