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Developing systems to collect data & use it for
FC/IE Programmes:The UK experience
2016 IFIE / IOSCO Global Investor Education Conference
12-14 June 2016
Helen White Head of Financial Capability
The Money Advice Service (UK)www.fincap.org.uk / [email protected]
AimofUKFinancialCapabilityStrategy
People:• Empowerpeopletomakethemostoftheirmoney• &navigatefinancialconsequencesofsignificantchanges&eventsthroughlife– bothplanned&unplanned
TheFinancialCapabilitySector:• Directfunding&resourcestoactivities&methodsthatevaluationevidenceshowsworkwellinimprovingpeoples’financialcapabilityØAhighlyeffective&coordinatedfinancialcapabilitysectorØMaximisingCOLLECTIVEIMPACT&returnoninvestmentacrossthenation
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(October)2015- 2025
Howwedefinefinancialcapability
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4
8.2mareover-
indebted10million can’treadtheirbankbalance
fromabankstatement20million adultscouldnotpayanunexpectedbillof£300fromsparecashorsavings
20million adultsdon’thaveanapproachtokeepingtrackoftheirfinancesthattheyfeelworks
16millionadultscan’tworkoutacalculationtoaddinterestearnedtoa
savingsbalance25millionadults
havenofinancialgoals35millionadultsdon’thaveasavingsbufferequaltothreemonths’salary
35millionadultshavenoplanforachievingtheirfinancialgoals
ScaleofthechallengeintheUK
Engagementisbiggest
challenge
BuildingFinancialCapabilityrequirescommongoals,
tools&measurestodriveCOLLECTIVEIMPACT
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Whydoesan“isolatedimpact”approachtofinancialcapabilitynotwork?
• UKfinancialcapabilityisnotimproving,despiteuncoordinatedeffortsbyover250organisations
• Withoutsharedstrategicgoals,coordination&leadership:littleincentivefororganisations(oftencompeting)toshareinformation&worktogether
• Factorsinfluencingfinancialcapabilityarecomplex&inter-connected– Isolateduncoordinatedactivitiesignorethis
• Resourceswastedonineffectiveactivities&duplication• Gapsnotidentified&filled
ØOneorganisation– ormanyisolated&uncoordinated–notabletoachievescaleofsocialchangeneeded
ØUncoordinatedresourcesachievepoorimpact&returnoninvestment
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5elementsofcollectiveimpact
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CommonAgenda/Goals
SharedMeasurement
MutuallyReinforcingActivities
ContinuousCommunication
Backboneorganisation
COLLECTIVEIMPACT
100+ 90+
50+ 60+
15+
Workingtogether
thousands
LEADERSHIPisneededtodrivecoordination,achievecollectiveimpact&returnoninvestment
• Takelongterm&holisticperspective• Buildwidespreadcommitmenttosharedstrategicgoals• Setoutroadmap forstrategydelivery,identifypriorities• Buildexpertise onfincap landscape• Identifylinkages,duplications&gaps• Collectdata,measure&communicateprogress• Build&shareevidence onwhichactivitiesachievegreatestimpact&returnoninvestment
• Encouragetargetingofresourcesbyallatactivitieswithprovenimpact,fillinggaps,minimisingduplication
• Maintainfocusonstrategicgoals&roadmap,inthefaceofcompetingdemandsforattention&resources
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KEYMESSAGE1:
COLLECTIVEIMPACTismoreeffectiveinovercomingthechallenges&achievingchangethanisolated,uncoordinatedimpact.ButCOLLECTIVEIMPACTrequiresleadership onstrategy&practicalapproachestodelivery.
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DATA&EVIDENCE:TheUKFramework
Data&Evidence
Framework
NationalFinCapSurveys
CompositeMeasuresofFinCap
TheoriesofChange
OutcomeFrameworks
EvaluationToolkit
IMPACTPrinciples
Research
EvidenceHub
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NationalSurveyoffinancialcapability• 2015Survey=baselinemeasureofUKfinancialcapability
• Largedataset• Nationallyrepresentativesampleof5,600adults18+
• 130questionstomeasureself-reportedfeelings,beliefs,attitudes,behaviours
• Surveytoberuneveryotheryear• Alsoplanasurveyofchildren,youngpeople,parents&teachers
• Consideringasurveyofolderpeopleinretirement
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8.2mareover-
indebted10million can’treadtheirbankbalance
fromabankstatement20million adultscouldnotpayanunexpectedbillof£300fromsparecashorsavings
20million adultsdon’thaveanapproachtokeepingtrackoftheirfinancesthattheyfeelworks
16millionadultscan’tworkoutacalculationtoaddinterestearnedtoa
savingsbalance25millionadults
havenofinancialgoals35millionadultsdon’thaveasavingsbufferequaltothreemonths’salary
35millionadultshavenoplanforachievingtheirfinancialgoals
Keyfindingsfrom2015survey
Insightsfrom2015Survey
• Mostpeoplemanagingrelativelywelldaytoday• Butfarfewerpreparingwellforfuturelifeevents• Helpingpeoplekeeptrackofmoneyday-to-dayisabuildingblockforsaving&preparingforthefuture
• Focusingpeopleongoalsforthefuturemotivatessaving
• Havingafuturefocusisimportant– weneedtounderstandhowtoencouragethis
• Skills&knowledgearelessofabarrierthanmotivation formost,butpocketsoflowskill
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Furtheranalysisofsurveyresponses• Tounderstandtherelativeimportanceofdifferentfactorsininfluencingfinanciallycapablebehaviours,&howtheyinter-relate.
• Allsurveyquestions/measurescategorisedinto4groups:ØWellbeingoutcomes– whatweideallywanteveryonetoachievethroughbetterfinancialcapability
ØFinanciallycapablebehaviours – thewaypeoplebehaveandtheactionstheytake.Thesecanbeinfluenceddirectly,orviaenablers/inhibitors.
ØEnablers&inhibitors– thingsthatmakefinancialcapabilityeasierormoredifficulttoachieve– i.e.knowledge&skills;attitudes& motivations;ease&accessibilityoffinancialservices.Weaimtoinfluencethese.
ØMediators – Thingsthatmakecapabilityeasierormoredifficult– e.g.levelofincome;children.Wecan notinfluencethese.
FINANCIAL WELLBEING
Current wellbeing
Longer termfinancial security
Debt measures
FINANCIALLY CAPABLE BEHAVIOURS
Managing money well day-to-day:
1. Managing credit use2. Active saving3. Keeping track
Managing and preparing for life events:
4. Building resilience5. Working towards goals
FINANCIAL ENABLERS & INHIBITORS
MINDSET
ABILITY
CONNECTION
4. Financial knowledge
5. Internet ease & access 6. Financial engagement
1. Attitudes to saving 3. Controlled spending
2. Financial confidence
CompositeMeasuresofFinancialCapability
Howwewillusethesecompositemeasuresoffinancialcapability• Wewilluseonlythe5behaviourmeasurestomeasurethesuccessoftheFinancialCapabilityStrategy:
• Managingcredituse• Activesaving• Keepingtrack• Buildingresilience• Workstowardsgoals
• Butwewillalsocollectdataon&monitorthewellbeing&enabler/inhibitormeasures
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KEYMESSAGE2:Youneedtobuildadata&evidenceframeworkthatwillprovide• acommonmeasure offinancialcapability&•evidenceonthewiderimpactsofgoodvspoorfinancialcapabilityi.e.whyshouldanyonecareorinvest
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TOOLS
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TheoryofChangeATheoryofChangeisaplanforsolvingaproblem.Helpsplanaproject&decidehowtomeasureitssuccessØStartbydefiningtheproblemyouwanttosolve&yourgoal(howyouwillknowtheproblemissolved).Ø Mapoutallchanges(orOutcomes)thatneedtohappenØHelpsyoudecidewhattodo &whattomeasure – toprovewhetheryouhaveachievedthechangeyouexpected/wanted
OutcomesFrameworksOutcomesyouwanttoachieve
Indicatorsoffinanciallycapablebehaviours
Questionsthatcanbeusedpre- &post- actiontomeasuretheimpactofanactivityonfinancialcapability
FINANCIAL WELLBEING
Current wellbeing
Longer termfinancial security
Debt measures
FINANCIALLY CAPABLE BEHAVIOURS
Managing money well day-to-day
• Managing credit use• Active saving• Keeping track
Managing and preparing for life events
• Building resilience• Working towards goals
FINANCIAL ENABLERS & INHIBITORS
MINDSET
ABILITY
CONNECTION
Financial knowledge
Internet ease & access
Financial engagement
Attitudes to saving
Controlled spending
Financial confidence
EvaluationToolkit
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24
EvidenceHub
EvidenceHubbringstheevidenceonwhatworkstogetherinoneplace
Translates it for non-
researchers
Features an easy to
understand ratings system
Quality assured by
the Personal Finance
Research Centre
KEYMESSAGE3:
Youneedtobuildevidencetoidentifywhatworks– i.e.activities&methodsareeffectiveinimprovingfinancialcapability–&willachievemaximumimpact&returnoninvestment.
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MAS‘Whatworks’grantfund• £7million fund tobeawardedasgrantstobuildevidenceonwhatworksinimproving financialcapability
• Allprojectsmustrobustlyevaluateimpactusingapproach&toolscreatedbyMoneyAdviceService
• AllfundedprojectsmustshareresultspubliclyviaMASEvidenceHub
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3typesofprojectstobefunded:1. Existingfinancial
capabilityinterventions:Evaluateimpactonusers,effectivenessinimproving financialcapability
2. PotentialtoScaleup:Evaluateextensionofexistinginterventions-alreadyproventobeeffective,- todifferenttargetgrouporwidergeographicalarea
3. Newapproaches:Develop,pilot&evaluateimpactofnewideas
• Will telluswhatimpactdifferenttypesofactivities&methods financialcapability&behavior,&howbigtheimpactonindividuals
• Butmoreworkneededtomeasurethevalueoftheimpact,relativetocosts,todeterminereturnoninvestment
KEYTAKEAWAYS1. COLLECTIVEIMPACTismoreeffectivethan
isolateduncoordinatedimpact– Butrequiresleadership.
2. Buildadata&evidenceframeworkthatprovidescommonmeasuresoffinancialcapability&evidenceonwhyshouldanyonecareorinvest.
3. Buildevidenceonwhatworks &willachievemaximumimpact&returnoninvestment.
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