1. Saving Money:
Research Insights
Barbara O’Neill, Ph.D., CFP®, AFC, CHC
Rutgers University
oneill@aesop.rutgers.edu
Michael Gutter, Ph.D.
University of Florida
msgutter@ufl.edu
Tim Griesdorn
Iowa State University
tgriesdo@iastate.edu

2. Week
A national social marketing campaign designed to build a culture of
savings in America as a core component of financial stability

3. America Saves Sound Bite
Set a Goal.
Make a Plan.
Save Automatically.

4. Did You Ever Wonder… Does
Research Support The Three
Keys to Saving?
What do
research studies
say about saving money?

5. Webinar Objectives
• Review the findings of recent studies about
saving money
• Discuss the implications of these studies for
practitioners personally and professionally
• Create a “one-stop” source for published
research study links about saving

6. What Do You Want to Know
Most About Savings from
Research?
Please insert your Twitter
Tips in the Chat box

7. Research Study Topics
• Savings behaviors of Americans
• Characteristics of successful savers
• Resources for saving money
• Barriers to saving money
Mix of government, non-profit, and academic studies;
last 10 years of JFCP articles abut savings

8. Research About
Savings Behaviors

9. Savings Behavior
• 6th Annual Savings Survey (national) by
CFA & ASEC (2013):
http://www.consumerfed.org/news/644
• 54% of Americans “have a savings plan
with specific goals”
• 43% have a spending plan that allows
them to save for goals
• 50% of pre-retirees save for retirement at
work
• 41% preauthorize transfers from checking
to savings or investments
• 49% know their net worth
• 65% have sufficient emergency savings
Implications
•Provide tools for financial goal-setting
and net worth and spending plans
•http://njaes.rutgers.edu/money/pdfs/goalsetting
worksheet.pdf
•http://njaes.rutgers.edu/money/pdfs/networthca
lcworksheet.pdf
•http://njaes.rutgers.edu/money/pdfs/fs421work
sheet.pdf
•Provide tools to sign up for employer
savings plan at financial seminars and
benefit fairs

10. Savings Behavior
• 5th Annual Savings Survey (national) by
Implications
CFA & ASEC (2012):
http://americasavesweek.org/images/as •Provide planning tools and
w2012pr.pdf
encourage future-mindedness
• 2/3 of Americans spend < their income
and save the difference and have
adequate emergency funds
• Having a savings plan with specific
goals can have beneficial financial
effects, even for lower-income families
(< $25,000)
• Those with a savings plan are much
more likely to spend < income and save
(85% of all 1,007 respondents vs 44%)
– http://www.americasavesweek.org/forindividuals/picture-your-savings-goal
•Provide successful savings role
models…people with “street cred”

11. Savings Behavior
• Study of 1,000 retirement plan
participants indicates gaps between
awareness and action: http://www.fa-
Implications
•Beware of using technical jargon that
people don’t understand
mag.com/news/gap-exists-between-savings•Break recommendations into a series
knowledge-and-action-11328.html
of action steps
• 78% know they should determine
how much to save for retirement but •Help people find and use planning
and saving resources
only 33% know how
http://www.choosetosave.org/ballpark/
• 65% believe investment
diversification is important but only
1/3 know how to do it
https://personal.vanguard.com/us/insights/retire
ment/tool/retirement-expense-worksheet
• 67% know they should adjust
investments over time but only 30%
know how to do it
https://www.tiaa-cref.org/public/pdf/adviceplanning/toolscalculators/A125820_budgeting_worksheet.pdf

12. Savings Behavior
• 2013 Retirement Confidence Survey
Implications
(EBRI): 57% of U.S. workers have <
$25,000 in total savings including 28% that •Stress the benefits of employer
have < $1,000 (excluding a primary
savings plans
residence and DB pension plan)
•Sign people up at workplace
seminars or auto-enroll them
•Fine line between educating people
• Workers who participate in a retirement
and scaring them so they say “Why
savings plan at work (45%) are
considerably more likely than those who
bother? I’ll never be able to save
are offered a plan but choose not to
enough money”
participate (22%) or are not offered a plan
•Example: Showing the 4%
(18%) to have saved at least $50,000
withdrawal rule on a low sum: $25,000
• http://www.ebri.org/pdf/surveys/rcs/2013/Finalx .04 = $1,000 a year.
FS.RCS-13.FS_3.Saving.FINAL.pdf
• Only 12% have saved $250,000 +

13. Savings Behavior
• Fidelity: 401(k) plan participants
save 8% of their salaries in 401(k)
plans; When a typical employer
match is factored in, the savings
rate increases to 12%
• Average 401(k) at end of 2012 had
$77,300
• Younger workers use Roth 401(k)s
the most: 10% for workers in their
20s vs. 6% of workers overall
• http://www.fidelity.com/insidefidelity/employer-services/fidelity-analysisfinds-record-high-average-401k-balance
Implications
•Teach the “Kick It Up a Notch”
behavior change strategy:
http://njaes.rutgers.edu/sshw/workbook/21_Kick
_it_Up_a_Notch.pdf
•Show people the dollar benefits of an
“extra notch”
•1% More Calculator:
http://www.nytimes.com/interactive/2010/03/24/
your-money/one-pct-more-calculator.html?_r=0
•Use a Monte Carlo calculator to show
how extra savings increase the
chances of retirement success

14. Savings Behavior
• The fewer the number of savings
goals, the better (Soman & Zhao):
– http://connection.ebscohost.com/c/article
s/67729139/fewer-better-number-goalssavings-behavior
• Presenting a single savings goal
leads to greater savings intention
and actual savings than multiple
savings goals
• Multiple goals increase the likelihood
of deferring action (“analysis
paralysis”)
Implications
•“Saving is easier when multiple
savings goals are integrated rather
than competing among themselves”
•Automate goal savings amounts so
you only have to “deal” with them once

15. Savings Behavior
Implications
• Fisher (2010) studied gender
differences in saving behaviors using •Understanding savings behaviors by
gender can inform financial education
2007 SCF data set
programs
• Women less likely to save short-term if
in poor health; no health effect for men •Risk tolerance affects saving behavior
as well as investment decisions
• Low risk-tolerance affected likelihood
of women saving in the short term and •In this study, income and wealth were
insignificant variables in explaining
saving regularly
likelihood of saving
• Each year of education made men
more likely to save in the short-term
and save regularly
•Good health habits, health insurance,
and emergency funds are especially
important for women
http://www.afcpe.org/assets/pdf/volume_
•Targeted financial education programs
21_issue_1/pattiejfisher.pdf
for women

16. Any Other Interesting
Research Findings About
Savings Behaviors?
Please insert your Twitter
Tips in the Chat box

17. Characteristics of Successful
Savers
Implications
• Okech et al. (U of Georgia): Paying
rent with cash, using VITA to prepare
•Encourage parents to model good
taxes, and witnessing parents save
financial management practices for
money in financial institutions were
positively associated with likelihood of children
having a motivation to save:
•Foster deliberate parent-child
• http://www.tandfonline.com/doi/abs/10. interaction about savings; use normal
1080/15588742.2013.766917#.UuARJ events as “teachable moments”
00o6M8
•Coordinate savings outreach programs
with tax preparation outreach

18. Characteristics of Successful Savers
• When kids have even a small
savings account in their name, it
increases the chance that they will
persevere and do what it takes to
graduate from college
• Those who have an account are
about seven times more likely to
attend college than youth without
savings
• The correlation between savings
and college graduation is
particularly strong among young
adults in families earning < $50k
• http://www.newamerica.net/node/69416
• http://link.springer.com/article/10.1007/s1083
4-012-9341-0#page-1
Implications
•Even modest savings can be
empowering and has aspirational
effects: gives people a sense that they
have control over their destiny
•Having money saved for college
reinforces the message to go to college
and work hard for good grades
•Encourage youth savings and stress
the psychological benefits

19. Characteristics of
Successful Savers
• Fisher & Anong (2012): 2007 SCF
data: 46% saved regularly, 32%
irregularly, 22% did not save
Implications
•Motives are strong predictors of
disciplined saving
• Precautionary and retirement motives, •Emphasize the importance of
long-term planning horizon, and higheridentifying goals to encourage a regular
income increased likelihood of saving habit of discretionary saving and
regularly or irregularly vs. no saving automated saving
• Retirement motive separated regular •Households in all income groups can
savers from irregular savers: 1.5 times be regular savers
more likely
•Stress saving small amounts over long
time horizons which makes goal
http://www.afcpe.org/assets/pdf/v23_j4.pdf attainment more feasible

20. Characteristics of
Successful Savers
• Grinstead et al. (2011) study of IDA program
participants in American Dream Demonstration
Implications
• About 4 of 5 low-income working families are “asset
•Learning needs vary. If resources
poor” with < 3 months expenses at the federal
allow, financial education should be
poverty level to survive a financial crisis
tailored and individualized (e.g.,
• Hours of participation in financial education
program, higher matched cap, prior use of a savingsfinancial coaching)
account, and greater educational attainment were
•Peer financial counseling
associated with greater likelihood of savings and
saving goal achievement
option to savings coaches
http://www.afcpe.org/assets/pdf/vol_22_issue_2_grinstea
d_mauldin_sabia.pdf
is a low-cost
•High match rates and match caps
motivate people to save
•Provide a link between people’s
saving goals and financial education
content

21. Characteristics of
Successful Savers
• Rha et al.(2006) study of the effect of
“self-control mechanisms on saving
behavior: SCF data
– (e.g., saving goals, anticipation of future
expenses, saving rules including saving
regularly or saving one family member’s income)
Implications
•Behavioral variables affect savings
behavior at all income levels
• Household saving behavior was strongly
•Help people establish realistic
affected by mechanisms that help people
personal “savings rules”
practice self-control; 56% spent < income
• Households with savings rules were
•Help people anticipate future financial
much more likely to spend < income than planning needs
those without rules
http://www.afcpe.org/assets/pdf/vol-1722-self-controlmechanisms.pdf
•Teach financial goal-setting and
provide tools with which to do it

22. Characteristics of
Successful Savers
• Hogarth & Anguelov (2003) study of
savings by low-income households, SCF
data
Implications
• Ability to save was associated with
socioeconomic (e.g., income) &
demographic (e.g., education)
characteristics, expectations (e.g., about
future income), motivations (e.g., a
reason to save), access to resources, &
institutional environment (e.g., credit
checks on potential depositors)
•Poor households could still probably
not meet short-term emergencies
• 60% of households at or below poverty
level indicated they saved
http://www.afcpe.org/assets/pdf/vol1411.pdf
•Even poor households can save
although amount is low; people at all
income levels were savers
•Hispanics were more likely to be savers
than White households in this study; not
always the case
•Expectations and motivations matter
•Support policies and programs that
promote saving

23. Research About
Savings Barriers and
Resources

24. Savings Barrier:
Scarcity of Attention
• Urgent current expenses trump
saving for future priorities
Implications
•Automated savings
• Scarcity engrosses people in current
needs
•Auto escalation (e.g., Save More
Tomorrow)
• If financially distressed: less mental
capacity to address problems &
•Form 8888 for automatic tax refund
future goals
savings
• Eldar Shafir (Princeton): Why Having •www.futureme.org (send e-mail to your
future self)
Too Little Means So Much:
http://money.cnn.com/2013/12/01/leader
•Target-date lifecycle funds
ship/saving-money.moneymag/

25. Savings Barrier:
Exponential Growth Bias
• “Tendency to linearize exponential
functions when assessing them
intuitively”
–People severely underestimate
how much interest they earn on
savings or pay on credit cards
• Biased people borrow more, save
less, and favor shorter maturities
• Stango, V. and Zinman, J. (2009),
Exponential Growth Bias and
Household Finance. The Journal of
Finance, 64: 2807–2849.
Implications
•Teach The Rule of 72 so people
understand “doubling periods”
•Use hands-on activities to illustrate
the effects of compound interest on
debt and savings
– http://rci.rutgers.edu/~boneill/assignme
nts/sliderule1.html
– http://rci.rutgers.edu/~boneill/assignme
nts/sliderule2.html

26. Savings Barrier: Time Delays
• Research by Tam et al.: The longer
Implications
the time delay in saving (e.g., a
month vs. a year), the less
•Think short-term in “baby steps”
accurately people can estimate their
future savings
•Save paycheck to paycheck instead
• People overestimate what they think of hoping for a future change (e.g.,
raise, job change) or windfall
they can save in the future
• Whenever there is a delay, people
think that things will get better
• http://pss.sagepub.com/content/earl
y/2013/12/19/0956797613512129.a
bstract
•Don’t focus on $1 million at
retirement; focus on savings
progress year to year

27. Savings Resource: Attitudes
• 2013 BlackRock Retirement Survey:
successful savers have certain
psychological and emotional attitudes
• Workers save more when they feel
empowered, confident, and positive
about savings process
Implications
•Teach/counsel about simultaneous
goals instead of goal sequencing
•Encourage automated savings
•Provide retirement savings calculation
• More likely to agree that “you can save
tools (study found that people who
for retirement and meet daily expenses
“figured out their retirement picture”
at the same time”
saved more):
• http://www.lifehealthpro.com/2013/11/22 http://www.choosetosave.org/ballpark/
/attitudes-impact-retirement-savings
•Show potential growth of savings:
http://apps.finra.org/calcs/1/savings

28. Savings Resource: Visualizing
the Future
• People need to visualize the future
impact of their savings
• Many people are not good with longterm decisions
Implications
•Show people what they could look like:
– http://faceretirement.merrilledge.com/
– http://in20years.com/
• Hal Hershfield (NYU) et al.: people save •Show people how much money they
more money after being shown digitally can lose by not saving:
altered pictures of themselves at older http://rci.rutgers.edu/~boneill/assignments/sliderul
age
e2.html
• http://www.marketingpower.com/abouta
ma/documents/jmr_forthcoming/increasi
ng_saving_behavior.pdf

29. Savings Resource: Workplace
Savings Planning Aids
• Lusardi et al. study: simplifying the
process of enrolling in employer plan
motivates employees to save
Implications
•Design initiatives that overcome
barriers to save
• Used flyer that broke the process down
•Make “how to” information “sticky”
into 7 steps and video program
•Break down financial
• 56% increase in election behavior
recommendations to save into “baby
within 30 days of viewing
steps”
communication programs vs.
•Develop videos that feature actors
employees not exposed to them
from the target audience being
• Differences were sustained after 60 and reached
90 days
• http://www.nefe.org/Portals/0/WhatWeProvide/Pri
maryResearch/PDF/DartmouthStudy.pdf

30. Savings Resource:
Future Forecasts
• People are motivated to save by
knowing how much income they can
withdraw from 401(k) in retirement
Implications
•Lobby employers or plan providers
for personalized retirement income
• Study by Gopi Shah Goda (Stanford) projections
et al.: Workers who received brochure
•Use retirement income calculator
showing increased income from
tools such as
increased savings saved $1,150/year
http://www.bankrate.com/calculators/r
more than those that didn’t get
etirement/retirement-plan-incomepamphlet
calculator.aspx and
http://money.cnn.com/calculator/retire
• http://crr.bc.edu/wpment/retirement-need/
content/uploads/2013/04/IB_13-4508.pdf (projections help to overcome •Translate savings RATES into
tendency to procrastinate)
savings INCOME

31. Savings Resource:
Prize Linked Savings (PLS)
• People are more likely to save when
Implications
offered the chance to win cash or prizes
•Combine features of savings and a
• PLS products more effective at inducing lottery, especially for low-income people
savings than standard interest-bearing who spend a high % of income on lottery
tickets and view lotteries as a form of
accounts offering the same expected
return
financial planning (not necessarily
irrational)
• Controlled experiment by Filiz-Ozbay (U •Resources:
of Maryland) et al.:
http://www.nber.org/papers/w19130
http://econweb.umd.edu/~ozbay/savings.pdf
http://www.savetowin.org/
http://saveyourrefund.launchrock.com/
http://www.d2dfund.org/
http://blogs.wsj.com/economics/2013/06/21/promis
e-of-prizes-helps-people-save/

32. More About PLS Programs
• Savings account that pools some of the interest from all
depositors (or uses sponsorship funds) and pays out a big
lottery prize every month or so
• Combines the thrill of a lottery with the safety of a savings
account
• A “no-lose lottery” because depositors have a chance to win
but can’t lose their deposited savings
• In 2009, Americans spent $58 billion on lottery tickets; about
$200 per person
• In all but a few states, PLS is illegal
–Big obstacle: state-run lotteries
http://freakonomics.com/2010/11/18/freakonomics-radio-could-a-lottery-be-theanswer-to-americas-poor-savings-rate/

33. Savings Resource: Understanding
the Impact of Compounding
• When shown the positive effect of
long-term compounding, people were
motivated to increase their savings
• People incorrectly assume that
savings grows linearly rather than
exponentially
• Median estimate of what account
balance would be was < 10% of what
it would be after 40 years with a given
rate of return
• http://www.scribd.com/doc/76254607/Misunderst
anding-Savings-Growth-Implications-forRetirementSavings-Behavior
Implications
•People have a hard time grasping
the concept of exponential growth in
savings
•“Recency bias” of current low
interest on savings doesn’t help
•Need to provide hands-on
experience with savings growth
– Time Value of Money Problems:
http://rci.rutgers.edu/~boneill/presentati
ons/index.html
– CEE Compound Interest Calculator:
http://www.econedlink.org/interactives/i
ndex.php?iid=2&type=educator

34. Savings Resource:
Saving Goals
• Regulatory Focus Theory: People
exhibit a promotion inclination (motivated
to seek accomplishment) or a prevention
inclination (motivated by safety); savings
goals can be classified this way
• Cho, Geistfeld, & Loibl (2010); promotionand prevention-related goals increase the
odds of saving significantly
– http://www.consumerinterests.org/assets/docs/CIA/CIA2010/2010c
hogeistfeldloibl.pdf
Implications
•“Individual regulatory orientations
were important factors in explaining
savings behavior”
•Develop savings messages to
influence either promotion or
prevention focused behavior
– Promotion: Save $X by [date]
– Prevention: Adequate emergency fund
• Prevention-oriented people more likely to •Savings promotion is enhanced by
start saving if prevention-oriented goals
understanding consumers’
are identified
motivation

35. Savings Resource:
Text Messages
• Karlan et al. (Yale): conducted
experiments with text messages
Implications
•Regular “nudges” can motivate
people to save
• Even low-income bank customers
managed to save part of their
income when nudged by regular text •Text messages are an effective
motivational tool
messages
• “Reminders will be more effective
when they increase the salience of
a specific expenditure”
•Reinforce the connection between
saving and specific financial goals
•Brain studies: imaging a future goal is
almost as powerful a “zing” as
• http://karlan.yale.edu/p/Top-of-Mind- achieving it (e.g., buying a car)
April2010.pdf

36. Saving Resource: Automation
•Behavioral Economist Richard Thaler (University of Chicago):
“Having an amount deducted from your paycheck is the only
thing that succeeds. If we have to decide with every paycheck
how much we should put aside, the answer is often zero.”
Source: Harford, T. How to Save Smarter. Parade, 5/10/09.
Save More Tomorrow™ (Thaler and Benartzi) Study:
http://www.jstor.org/discover/10.1086/380085?uid=3739808&uid=2&uid=4&uid=37392
56&sid=21103378462353
http://assets.aarp.org/rgcenter/econ/2007_02_savings.pdf

37. Savings Resource: Financial Advisors
• Principal Financial Group & Harris
Interactive (2011): Americans who
work with an advisor are more likely
to have taken steps toward financial
success
• Established goals for the future,
created a plan, more aware of
savings needed for retirement
• Also more confident in their ability to
achieve their financial dreams than
those without an advisor
http://www.principal.com/about/news/2011/crpadvisor-study071911.htm
• 2013 Study: People with advisors are
happier with their financial well-being
(60% vs. 42%):
http://www.principal.com/about/news/2013/crpwbi-workers-121213.htm
Implications
•Financial advisors foster goal-setting,
planning, action, and confidence (similar
findings from CFP Board/KRC Research
studies)
•Need financial advisors for the masses
•Need to take “best practices” programs
to scale
– Example: University of Florida “Master
Money Mentors”
– CFPB Financial Coaching pilot project is
promising

38. What Savings Barriers and
Resources Do You Experience
in Your Life and/or Work?
Please insert your Twitter
Tips in the Chat box

39. Other Relevant Research
Related to Saving Money

40. The Power of Social Norms
• Goldsten et al, (2008) study of social
norms to change behavior;
experiment about environmental
conservation program in hotels
Implications
•Provide positive financial frames of
reference such as % of employees
participating in an employer’s
retirement savings plan
• Telling people “the majority of guests
reuse their towels” proved superior to
traditional appeals used by hotels that
•Provide relevant research findings
focus solely on environmental
about financial behaviors of Americans
protection benefits
• Even more superior results for the
setting that closely matched
participants’ immediate circumstances
(“the majority of guests in this room
reuse their towels”)
• http://www.carlsonschool.umn.edu/as
sets/118359.pdf
•Use the “Wealth Test” from The
Millionaire Next Door: formula based
on age and income:
http://www.bauer.uh.edu/drude/Net.Wo
rth.Worksheet.pdf

41. The Marshmallow Test: Delayed
Gratification and Self-Control
• Mischel et al. study of delayed gratification
(late 1960s/early 1970s)
Implications
•When people are put in situations
• 4-year old children offered a choice between where they trust in a clearly defined
one small reward now or 2 rewards if they long-term gain, they are more likely to
pursue it
waited 15 minutes
• Children who waited had better life
outcomes including higher SAT scores and
scholastic performance, less substance
abuse, fewer behavior problems, and better
social skills and stress coping skills
http://harbaugh.uoregon.edu/Readings/UGBE/Mischel%20
1989%20Science,%20Delay%20of%20Gratification.pdf
•Willpower appears to breed long-term
success in life (strategic reasoning
skills and trust too?)
•Teach long-term gains of saving
•Develop learning activities that
encourage people to develop willpower
•Foster trust by learners

42. Recent ASEC Partner Meeting Research TakeAway Messages
• People over-estimate time TO retirement and underestimate time IN retirement
• Workers want to see projections of account balances at
retirement (current saving rate and increased %)
• Reframe retirement savings from “a number” to
monthly income: what will a pot of money buy you?
• Help people translate savings balance into income
• People take Social Security benefits SOONER- not
later- when they are shown “break-even age”

43. Recent CFA National Savings Forum
Research Take-Away Messages
• People don’t know their goals; it’s a barrier
• People need to have hope for the future to save
• Hispanics’ capacity to save is evidenced by the
amount of remittances sent back to home countries
• Savings has economic benefits for credit unions:
lower loan delinquencies and charge-offs
• Low interest rates are a barrier to saving; matching
(by employer or IDA program) provides a boost

44. America Saves Sound Bite: Not
Just a Slogan but Saving
Strategies Informed by Research
Set a Goal.
Make a Plan.
Save Automatically.

45. Key Research Take-Away:
Not Everything is in Your Hands
But You Can Control a Lot!
• Developing a spending
plan (budget)
• Personal “Restrictor
Plates”
• Taking “free money” from
• Reducing debt
employer
• Developing SMART
• Tax avoidance
financial goals
(minimization)
• Developing “savings rules”
• Commitment devices
(policies)
• Automated savings

46. Encouraging Healthy
Financial Behavior with
Worksite Wellness
Tim Griesdorn – Iowa State University
Kira Werstein – Iowa State University

47. Importance
• Affordable Care Act provides incentives for
companies to participate in worksite
wellness programs.
• Additional research is needed to
understand which programs are effective

48. Literature Review
• Health & Wealth overlap in 6 areas –
employers can increase worker
productivity. O’Neill (2009)
• As BMI increases, Net worth decreases.
Zagorsky (2004)
• Those in financial distress also report
poorer health. Bagwell & Kim (2003)

49. What is the Research
Question?
• Does participation in a holistic worksite
wellness program improve an individual’s
Personal Financial Wellness™ score?
• Can this improvement be sustained over
time?

50. Dependent Variable
• Personal Financial Wellness™ Scale
(Prawitz, Garman, Sorhaindo, O’Neill, Kim, & Drentea, 2006)
8 Question Scale (10 point Likert scale)
1=overwhelming financial distress/lowest
financial well-being to 10=no financial
distress/highest financial wellbeing
2012 National survey using the scale indicated
an average score of 5.2.
Cronbach’s alpha of scale = .95

51. Personal Financial Wellness™
Scale Questions
(Measured using a 10-point Likert Scale)
• What do you feel is the level of your financial stress
today?
• How satisfied are you with your present financial
situation?
• How do you feel about your current financial
condition?
• How often do you worry about being able to meet
normal monthly living expenses?

52. Personal Financial Wellness™
Scale Questions
(Measured using a 10-point Likert Scale)
• How confident are you that you could find the money to
pay for a financial emergency that costs about $1,000?
• How often does this happen to you? You want to go out
to eat, go to a movie or do something else and don't go
because you can't afford to?
• How frequently do you find yourself just getting by
financially and living paycheck to paycheck?
• How stressed do you feel about your personal finances
in general?

53. Method
• 178 participants from 3 Iowa manufacturing
companies
• Online employee survey
• Focus groups with employees
• Structured interviews with management
• Health Risk Assessment Pre / Post / 6 mo.
Follow-up
• Random assignment to control or treatment
groups

54. Program
• 14 Learning Modules in Program
– 5 related to financial literacy education
– 5 related to health & nutrition education
– 4 general topics (stress management,
behavioral change, understanding Health Risk
Assessment results, and exercise education)
• Each Learning Module approx. 30 minutes
• Program timeframe Jan 2013 – Jun 2013

55. Data Collection
• Prior to program (January, 2013)
– 10 page survey on health, nutrition, personal financial
wellness, self-efficacy, and life satisfaction
– Physical evaluation – height, weight, blood pressure,
blood glucose, wall sit, flexibility, body mass
composition, waist to hip ratio, triglyceride,
cholesterol, grip test, and step test.
• Conclusion of program (July, 2013)
– Survey
• Follow-up after 6 months (January, 2014)
– Survey
– Physical evaluation

56. Sample Characteristics
• 154 participants completed survey at
completion of program
• Pre-PFW mean score = 6.14 (sd 2.37)
• Post-PFW mean score = 6.43 (sd 2.38)
(Higher than national average for personal
financial wellness)

57. Demographic Variables
Age
Female
Sat. w/ Life
Self Control
Education
High School
Some College
Bachelor’s
Graduate
40.6 years mean, 13 years standard deviation
52%
4.52 (1-7 scale) Slightly Satisfied
2.53 (1-5 scale) Average Ability
27%
35%
34%
3%

58. Pair Samples t-test
PFW Scores
Pre-test
Post-test
Treatment M=6.42, sd=2.30 M=6.73, sd=2.24
(n=76)
t(75) = -2.21, p=.03, d=.14, Ƞ2=.066
Significant Improvement in PFW Scores
Control
(n=78)
M=5.95, sd=2.43 M=6.10, sd=2.48
t(77) = .96, p=.34
No Change in PFW Scores

59. DV - Individual Item Analysis
Control group (n=76)
Personal Financial Wellness
Level of financial stress today
Satisfaction with financial
situation
Feelings about current financial
condition
Worry about meeting monthly
living expenses
Pre
6.37
S.D.
2.21
Post
6.67
S.D.
2.16
6.09
2.42
6.11
2.49
6.10
2.27
6.37
2.20
6.57
2.59
6.93
2.51
1=High financial distress/low financial well-being
10=No financial stress/high financial well-being

60. DV - Individual Item Analysis
Control group (n=76)
Personal Financial Wellness
Could handle $1,000 emergency
Can’t afford to go out to eat
Living paycheck to paycheck
General level of financial stress
Pre
7.09
6.76
6.07
6.34
1=High financial distress/low financial well-being
10=No financial stress/high financial well-being
P<.05**, P<.10*
S.D.
3.06
2.78
3.13
2.29
Post S.D.
7.50** 2.82
7.21* 2.67
6.33 2.88
6.76** 2.21

61. Summary of the Findings
Participation in the Worksite Wellness
program had a small but significant effect on
PFW scores.
High correlation between satisfaction with
life scale and PFW scale (r=.53)
Moderate correlation between self-control
scale and PFW scale (r=.35)

62. Discussion
• PFW scores can be improved with
education
• Financial well-being should be included in
worksite wellness programs

63. Implications
• Programs should include self-control
strategies to assist with behavior change.
• Financial wellness might be considered
more quantifiable, therefore more easily
measured and influenced.

64. Questions or Comments ?

65. The Complex Nature Of Savings:
Results From Multistate
Research Project NC1172

66. NC 1172 Brief History
• Began in 2008
– Actually began even earlier under NC 1013
• Finishing its current 5 year research plan which
emphasized the complex nature of savings behavior in
low to moderate income families

67. Full Research Committee
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Chair: Michael Gutter
Chair Elect: Soo Hyun Cho
Secretary: Sheri Worthy
Teresa Mauldin
Michael Cheang
Sharon A. DeVaney
David Evans
Tim S. Griesdorn
Elizabeth Kiss
Jinhee Kim
Catherine Solheim
Cathy Bowen
Liz Gorham
Jean M. Lown

68. Data Collection
• Survey Sampling International
• Sample criteria:
– Income < $80,000
– Ages 24-66
– Target size was 1000 completes
• Took two weeks as web survey
• Some cleaning was required leaving a sample of 826

69. Data for These Studies
• Hayhoe & Gutter (2012)
– Reliability of the Scales in the NC1172
Complex Nature of Saving Data Set.
FCSRJ 40(30) 284-294
• Age 18-75
– Mean – 45.6
• 49% female respondents

70. Characteristics

71. Financials

72. Behaviors
Scale
# items
Cronbach’s
Alpha
Mean or Freq
Min
Max
Impulsivity
8
.93
20.39
8
40
Self efficacy
17
.91
61.40
29
85
materialism
7
.69
18.06
7
33
Distrust
4
.77
12.61
4
20
Anxiety
4
.86
13.14
4
20
Financial
Risk
Tolerance
5
.78
16.83
5
25
Fin Beh
Score
4
2.55
0
11

73. Origins
Measure
Reference
Impulsivity
Rook & Fisher (1995)
Self-efficacy
Sherer et al, (1982)
Materialism
Richins & Dawson (1992)
Distrust & Anxiety
Roberts & Sepulveda (1999)
Financial Risk Tolerance
Grable & Joo (2004)

74. FBS
1. How would you describe your (if you have no spouse–partner) or your family’s
spending over the past year?
–
Spending exceed income coded 0.
–
Spending equaled income coded 1.
–
Spending was less than income was coded 2.
2. How often does your family make plans on how to use your money?
–
coded 0 = Never to 4 = Most of the time.
3. How often does your family monitor your spending?
–
coded 0 = Never to 4 = Most of the time.
4. Does you or your family have written goals such as owning a home, retirement,
children’s education, or starting a business that require savings?
–
coded 1 = Yes and 0 = No.

75. Exploring the Relationship of Economic, Sociological,
and Psychological Factors to the Savings Behavior
of Low-to-moderate Income Households
Gutter, Hayhoe, DeVaney, Kim, Bowen, Cheang, Cho, Evans,
Gorham, Lown, Mauldin, Solheim, Worthy, & Dorman,
(2012)
FCSRJ 41(1), 86-101

77. Likelihood of Having Savings
Accounts Vs. Having No Accounts
• Demographics
– Age
positive
• Financial Behavior Score – Positive

78. Likelihood of Having Savings
Accounts Vs. Having No Accounts
• Sociological
– Number of information
sources used
• Psychological
– Planning horizon
• Negative
• Positive
– Number of perceived
barriers
• Negative

79. Likelihood of Having Savings & Investment
Accounts Vs. Having No Accounts
• Income (reference is 20001-60K)
– Income < 20 K Negative
• Net Worth Positive
• Education (reference BS/BA or +)
– High school or less Negative

80. Likelihood of Having Savings & Investment
Accounts Vs. Having No Accounts
• Sociological Factors
– Number of information sources Positive

81. Discussion
• Strong support for economics
– Life cycle factors
– Education
– Net worth, income
– Financial management behaviors

82. Discussion
• Sociology
– Consistent role of number of information sources
• Active information searching
– Information needs to be available on multiple channels/platforms

83. Discussion
• Psychological factors
– Perhaps many of these factors, not with this population group
– Barriers
• To using financial services
• To saving themselves
• Some are situational and only time or external support will
help

84. Financial Behavior Score and Outreach
• FBS is positive related to savings
– This is an important aspect to some of what is done in
Extension, think of the behaviors that were captured in FBS.
Often related to what we teach!

85. NC 1172: Future Research
• Behavioral economics and financial decision-making and
information management across the lifespan
– Student loan borrowing
– Home ownership
– Social Security Benefits
– Quasi-experimental design
•
http://lgu.umd.edu/lgu_v2/homepages/home.cfm?trackID=15376

86. Questions? Comments
Experiences?
Please complete the webinar evaluation form and
CEU request form
Happy America Saves Week!