Evidence type: Evaluation i
Information about the programme design and rationale
Evidence about Financial Capability outcomes for programme participants
Evidence that the Financial Capability outcomes were caused by the programme
Evidence about programme implementation, feasibility, and piloting
Evidence about relative costs and benefits of the programme
Recent research has shown that nearly a third of Canadian consumers struggle to cover their living expenses, and almost half rely on some form of credit to make ends meet. Existing financial literacy programmes have been criticised because they tend to focus on disseminating knowledge without developing people’s financial skills and confidence. The Financial Consumer Agency of Canada (FCAC) identified this, and in 2016 launched a tool which delivered financial literacy messages directly to consumers who do not budget. The aim of the tool was to help people build their knowledge, confidence and skills relating to budgeting, with the ultimate objective of changing their budgeting behaviour. FCAC directed the tool towards 10,716 people, of whom 54% (5,767) had a budget and 46% (4,949) did not. Individuals without a budget were targeted for two subsequent interventions.
Researchers in the Education, Research and Policy Division of the FCAC conducted the research. The study employed a pre- and post- design over the course of a month, which gathered evidence regarding changes in knowledge, confidence and behaviour after using the tool. It compared changes of a treatment group (the 4,949 people who did not have a budget) before and after using three different interventions, with a control group (a new group of people, chosen randomly) who received a fourth intervention. The researchers also conducted analyses on indicators of knowledge, confidence and behaviour related to budgeting, which was analysed by age, gender, province and household income.
Changes in budgeting behaviour
The study found that through the introduction of knowledge and confidence-building content and resources, non-budgeters increased their intentions to budget, as well as their actual budgeting behaviour.
Knowledge of budgeting
The study found that non-budgeters’ knowledge increased as a result of exposure to the financial education messaging.
Confidence in ability to budget
The study’s results indicate that the confidence of non-budgeters increased regarding budgeting over the course of the pilot.
Education, Research and Policy Division, Financial Consumer Agency of Canada