From 2021 to 2024, the research team at EVERFI conducted a longitudinal study, sponsored by the MassMutual Foundation, on the effects of six financial education courses for middle school and high school students. This unprecedented longitudinal research analyzed the changes in financial knowledge, self-efficacy, behaviors, and family conversations among a group of 345 upper middle school students and their families over a three-year period and examined the courses’ effects six months after the program ended. Using a randomized control experimental design and rigorous statistical methods, the study revealed a clear point: students who receive a series of financial education interventions are more likely to achieve sustained improvement compared to those who receive just one.
Multiple Courses Lead to Sustained Increase in Financial Self-Efficacy
Financial self-efficacy is the level of confidence people have in their ability to manage their personal finances and deal with various financial situations to achieve their financial goals. People who are more confident in their financial capability are more likely to engage in desirable financial behaviors. This longitudinal study showed that although taking a single introductory level course increased students’ confidence in their financial skills, only those who took multiple courses achieved sustained improvement that remained significant after the program ended. Compared to the students who took only one course, those who took multiple courses had more chances to reinforce what they learned in previous courses and were reassured that they could handle real-life financial situations.
Continuous Financial Education Prepares Students to Face Real-World Financial Challenges
Financial habits formed at a young age can have life-long impacts on adolescents. Although the courses did not have an immediate impact on students’ financial behaviors (like saving and financial planning), a sharp divergence occurred during the six-month follow-up period: while the students who took multiple courses had a significant improvement in their financial behaviors, no such changes were found in those who took only one course. By the end of the study in Fall 2024, most participants were in their final year of high school or had graduated and started to face real-life financial situations that required them to act. This finding indicates that adolescents who received a series of financial education were better prepared to engage in healthy financial behaviors when the opportunities to act emerged. Moreover, the analysis showed that taking multiple courses benefited students from lower-income families more than they did for students from wealthier families. Therefore, our courses not only improved students’ financial behaviors, but also helped narrow the income-based gap in financial capability.
Continuous Financial Education Prevents the Decline in Family Conversations on Financial Topics
Family conversations on financial topics are a critical component of financial socialization, the process through which children form financial attitudes, values, and behaviors by observing and learning from the people around them. The analysis found that taking multiple courses slightly increased the frequency that the students talked with their parents about financial topics. More importantly, even after the completion of the program, the students who took multiple courses maintained the same frequency of communication, while those who took only one course had a sharp decrease in conversations with their parents. It is a common phenomenon for adolescents to communicate less with their parents as they form their own identities and seek more independence, but open and constructive discussions on financial matters at home are crucial for students as they transition to adulthood. The study showed the value of continuous financial education with multiple courses as they equipped students with the relevant knowledge to maintain conversations and make them more comfortable talking about money.
EVERFI has published three annual reports which discuss the effects of each course students took in the study. The final study, focusing on the overall improvement over the three years and the post-program effects, will be submitted to a peer-reviewed academic journal for review.
Contact the EVERFI Research Team ([email protected]) to learn more about the longitudinal study and other research endeavors.