PowerPoint Presentation for Reaching Beyond eXtension to Inform Extension Programming Decisions

1. Survey on Personal Finance
Important Topics
Megan O’Neil, MPS, CFCS, The University of Maryland
Fahzy Abdul-Rahman, Ph.D., New Mexico State University
Barbara O'Neill, Ph.D., Rutgers University
2012 eXtension Annual Conference
October 2012

2. Methods
• Survey on Personal Finance Important
Topics
– OPENED: November 1, 2011 to April 30th 2012
– n= 724
• “The goal of this survey is to gather information
on important topics in personal finance. While
your participation in this survey is voluntary,
your response will greatly help in designing
personal finance programs to meet the public's
needs.”
• Google Survey Docs

3. • Family Economics News: March - April 2012 -
3/22/2012
• Ken McDonnell McDonnell@ebri.org to EBRI - Distro -
ASEC_Partners ASEC_Partners@ebri.org 2/9/2012
• Shockey, Susan sshockey@nifa.usda.gov Wed
2/8/2012 2:07 PM
• Shockey, Susan sshockey@nifa.usda.gov Wed
11/2/2011 Everyone - NIFA Everyone Distribution List
everyone@nifa.usda.gov + 'family-
econ@lyris.nifa.usda.gov'; 'fcsldrs@lyris.nifa.usda.gov';
'fsllcontacts@lyris.nifa.usda.gov'; 'amer-
saves@lyris.nifa.usda.gov‘ + fe-
partners@lyris.nifa.usda.gov

4. The Survey Link
• http://bit.ly/qG0IG5

6. Preliminary
Results
• After
survey
creation
• How to
view the
ready-
made
stats

7. To Obtain
Statistics
• Click “See
Responses”
• & select
“Summary”

8. Data Set
• N= 724
• States with = or > 20 respondents
were included for interpretation
• Selected Set N=533 representing 77%
of total original response
• Separated regions (NE, MW, S & W)
• Northeast Region (n=22) too small
for further reliable analyses and
comparison by region

9. 13 States Included n= %N=
Alabama 28 4%
Florida 36 5%
Iowa 42 6%
Maryland 49 7%
Michigan 72 10%
Minnesota 20 3%
Mississippi 60 8%
Missouri 24 3%
Ohio 22 3%
Oklahoma 47 6%
Utah 28 4%
Virginia 98 14%
Washington 27 4%

10. Respondent Characteristics
• Age18+; age 19+ (Nebraska & Alabama); range ages
18 – 80 with good bell shaped distribution
• Predominantly female (81%)
• Income
Less than $25,000 6%
$25,000 to $49,999 30%
$50,000 to $74,999 28% 45%
$75,000 to $99,999 17% 63%
$100,000 or greater 18%
• Highly educated
Bachelor’s degree 28%
Post college degree 54%

11. Race Ethnicity

12. Did We Survey Ourselves?

13. People in the Southern region rated themselves less
knowledgeable than those in the Midwest or West
rated themselves
(MW 4.125/S 3.916/W 4.194 p=.0027),
but overall, all
people rated themselves
quite knowledgeable.

14. People in the Western region reported getting their
personal finance information from adult education
more than those from the Midwest or South
(MW 3.438/S 3.280/W 3.605 p=.0223)

15. People in the Western and Midwestern
regions took courses in college and/or
majored in a personal finance area and/or
attended workshops/talks to a significantly
greater degree (p=.0353, p=<.0001 and p=.002
respectively) than those from the South

16. Important Topics for Adults:
Adult Respondents
• The Western region was significantly
more concerned than other regions with
several topics for adults as compared to
other regions (mortgages, loans, other,
paying yourself first, debt and credit,
scams/frauds/identity theft)
• The Midwest and Western regions
shared a significantly higher concern for
dealing with mortgages

18. Q4: Important Personal Finance
Topics for Adults - OTHER
• Tax forms are so complicated it would be useful to have some classes about different forms and • How to get the most from your savings and keep it
issues. estate planning credit history/ credit safe. How to fix bad credit...where do you start?
cards/which banks are the best (fees vs. no fees) Will I be able to manage on Social Security? I have old credit issues, some resolved, a few not...what do I do?
Will there still be Social Security? Will I win the lottery? what legislation is in the works Maybe call the workshop: Mistakes don't have to haunt you forever: How to get your good credit
that will change our exemptions and savings-ir not being able to claim taxes or interest on our score back. Investing in stock market, mutual funds, money markets -- define each for
mortgages. Taxing social security, etc. allocating savings during retirement to increase income personal need/goal Credit history, credit score and how to improve your "numbers"
while decreasing risk of losing principal. How do I get out of the payday loan cycle. creating a spending plan Wills As my parents did, from the time my children
Being underwater on your mortgage. Short sale options to get out of loan. Strategic default on home were old enough to grasp the concept of money, I urged them to plan for their futures. When they
loan. Declaring bankruptcy. Dealing with aging parents finances Teach children about money graduated from college and got their first jobs, I always told them to pay themselves first, even if it's
How to keep track of recent changes in bank fees and charges. just a few dollars a week. That habit, over time, can lead to financial stability. the perils of
Since I do not own a home and will probably not be able to save a significant down- payday lending Understand income tax.
payment, affordable housing for the immediate future and certainly into retirement is a serious Keeping key financial records.
concern for me. At this time due to salary I do not qualify for assistance. Rents are extremely Purpose of a will.
expensive. Understanding Taxes, Marriage and Money, Financial Major consumer protection laws.
Issues/Implications of Divorce, Children and Money; Foreclosure Prevention Chronic Evaluate advertising on financial services and products.
spending issues(as means for social opportunities or to stuff frustration) I believe more Know how to comparison shop for financial services and products. How to get out of debt!
should be done to help citizens break down the finncial implications facing the US economy. Cost of vices such as gambling Since many low income people in rural
Currently one line headliners from newpapers and Congress are not clearly lining up the facts on areas have no computer access, publications on a lower educational level are needed. Someone
the issues and proposed solutions. recently told me "Extension's publications are wonderful, however, someone with a low level of
Credit Scoring practicies education won't/can't read them. You need something with more pictures, simply written."
Credit rate practicies Estate planning - end of life issues Buying vs. Renting after the teaching children financial responsibility, teen financial literacy Need information on Estate
debt crisis. My new bank removes money from my bill pay account ahead of the send Planning Correlation with healthy lifestyle; taking care of assets, being
date, then take 5 business days to send the check and then the check is not cashed for 2 to three resourceful Critical thinking skills and discernment best long term care options
days. Who has ownership of the money between the time when the money is taken out and the I think one of the main important topics or overriding themes is coping or adjusting to the
time the person receiving the check cashed the check? I think that it should be me. My bank uncertainty and change in the economic environment at large. This affects people across the entire
representative cannont tell me where the money is during the time frame. I am not sure why the range of topics cited above. I think the significant pace of change over the last several years has left
representative cannot provide clarity. most people struggling to keep up.
I am looking at other banks and credit unions to see what services and fees they charge for my I think those most immediately affected by the economic crisis, e.g. the unemployed, those who
specific needs before I move or stay. Any suggestions? have seen a significant reduction in income, facing foreclosure, etc., are naturally having their
attention focused on dealing with relatively near term personal finance concerns, like managing
Lots of changes with banking - many choices for checking accounts - money cash flow & debts. Tithing Managing business investments There is a
markets, saving, etc. What is best?? Crisis financial management large segment of the populace without basic information/knowledge about personal finance, such
Unemployment impact as: balancing a checkbook, figuring interest, actual cost in time pay, etc. I believe correcting this
Investing education, even at the adult level, should be offered starting with a very simple lack of basic knowledge should be the highest of priorities.
"dummies" version...assume the participant has hardly even glanced at a stock market report. Too Finances for the single woman
many programs are too complicated even at the beginner level, and those who have no experience
often feel overwhelmed when instructors assume they know how to read the business pages. Estate planning Investments like gold silver oil etc. Home Repairs
Mitigating risk The above-checked topics are important to me -- not necessarily others.
How to repair your credit. I just wanted to be clear that for these "important Car Buying
topic" questions, I checked off which topics are the most important IMHO. I think ALL of the topics
listed are currently important topics. n/a Money & Marriage - communications about Emergency Preparedness Lending money to family members or friends.
money Stock Market Basics Adult children moving back understanding how economic conditions will affect consumers; managing money in crisis situations;
home. Saving Money at the gas pump and at the grocery store. All areas are credit scores; Mortgage Fraud and what government programs are available and safe
very important. Thank you for asking. Getting out of debt. I would also include preparing What is the best way to address complaints against federal and or State banks?
wills and trusts for everyone. All information I find is based on already having extra left over Why isn't the community more involved in teaching basic financial skills in HS or even elementary
after the bills. What do you do if you do not have debt or extras like cable and still don't have school? How to estbalish credit. CFP stock market
enough leftover for food? How do you get to the point where you are working month to month? Budgeting after loss of job or other income Basic financial literacy concepts:
Consumer disclosures. Fees in banking and lending. The economy the next twenty compounded interest, why paying cash makes sense. Undestanding WHY its inportant to develope
years will be nothing like the last twenty due to government deficit, entitlement program changes, money management life skills. How to teach Children about money
demographic changes, etc.etc. Living within ones means is going to be more important. Taxes will Talking with boyfriends/ girlfriends about money
be higher. How much house can you afford
Importance of credit score
I think our American culture is too. . . nice when discussing/teaching about debt
management. I think debt can be helpful when doing initial business startup costs or buying a home
or paying for Professional school, not undergrad. I think it is a mistake to keep telling students and
clients that debt is ok as long as it is within said percentage of take home pay. I think we should
view debt as the entitlement breeding cancer that it is. It destroys individuals and families and few
financial professionals are bold enough to call it for what it is.
I also think people should understand taxes better. They can keep better records when they know
more. I also think they should know what their money is being used for,not just intended to be used
for. As a single Mom, what ways can I plan to pay for my children's college without
developing life-long debt. Ensuring that banking services are available to all consumers.
Dealing with financial/tax issues in blended families
Tax issues to Families of Fallen Troops choosing a financial advisor
CCCS and legitimte bankruptcy alternatives medical

19. Important Topics for Youth: Adult Respondents
• The Western region was significantly more
concerned than other regions with the following topics
for Youth: paying yourself first and managing debt
and credit
And somewhat more concerned with the following
for Youth: importance of credit history and
scams/frauds/identity theft
• The Southern region was somewhat more concerned
for Youth with using online banking
• The Midwest region was somewhat less concerned
for Youth with saving and investing options

21. Important Topics for Older Adults:
Adult Respondents
• The Western region was significantly more
concerned than other regions with the following
topics for Older Adults: scams/frauds/identity
theft and dealing with mortgages
And somewhat more concerned with the
following for Older Adults: talking about
with family, knowing your consumer rights
and caregiving
• The Midwest and Western regions shared a
somewhat higher concern for financing
healthcare expenses

23. If the Sample is Reliable, What Does the
Geographic Correlation Tell Us?
• People living in the West will think personal finance education
on almost any topic is important!
• The South recognized using online banking as an important
topic for Youth more than any other region. This may mean
that people in the South are more aware of online banking
technologies as they relate to Youth and potentially are more
interested in Youth financial capabilities outreach.
• The Midwest expressed less concerned for Youth with
saving and investing options. Again – this may mean that
Midwesterners are more aware of Youth priorities. Awareness
could translate into support or nonsupport of programs.
• What is happening locally and regionally in housing, in
particular Mortgages, raises concern significantly for
education in this topic area.

24. Discussion and
Implications

25. Financially Knowledgeable
Sample?
• 8 of 10 respondents agreed (51%) or strongly
agreed (30%) that they were financially
knowledgeable
• Is this really true or indication of overconfidence?
– People often don’t know what they don’t know
• Would be interesting to assess actual financial
practices

26. A Sample of Do-It-Yourselfers?
• Only 11% always and 48% sometimes get
information from financial advisors
• Family members rate about the same: 14%
always and 45% sometimes
• Are people getting information themselves or
just not getting information?

27. Sources of Financial information
• Mixed preferences among traditional Extension
outreach methods
• Always/sometimes combined percentages:
– Seminars: 39%
– Courses since leaving school: 53%
– Newspapers/magazines: 73%
– Cooperative Extension: 49%
– Internet Sources: 72%
– Software: 30%
• 80% said their personal finance courses were
“self-studied”

28. “Hot” Topics Reflect
Respondents’ Age and Recent
Economic Conditions
• Planning for Retirement (85%)
• Saving and Investing (80%)
• Managing Debt and Credit (79%)
• Budgeting (68%)
• Managing Cash Flow (61%)
• Scams, Frauds, and Identity Theft (60%)

29. Age-Specific Content
Preferences
Youth Older Adults
• Making Decisions About • Preparing Wills and Trusts
Money (87%) (89%)
• Using Credit and Credit • Managing Retirement
Cards (82%) Income and Savings (88%)
• Keeping Track of Money • Long-Term Care (83%)
(81%) • Financing Health Care
• Understanding Income and Expenses (81%)
Expenses (78%) • Scams, Frauds, and Identity
• Creating a Plan for Theft (77%)
Spending (75%)

30. 2012 CFA/Primerica Study
• Study of households earning $40k to $100k
• Analyzed Federal Reserve data
• Respondents rated “good to excellent” ability to
budget and manage credit card debt (81%) and
save for retirement (63%)
• Only 15% rely on television, the Internet, or
publications
• Typical family had retirement savings of $27,300,
down from $37,800 in 2007

31. Implications for Future
eXtension Outreach
• Develop new content to assist “do-it-yourselfers”
(e.g., worksheets, calculators, resource guides, do-
it-yourself financial planning activities)
• Develop new content on priority topic areas
• Use multiple methods of outreach, especially
Internet and publications
• Strive for increased visibility as an unbiased source
of financial information