Teaching financial literacy to adults

While residents of Canada want to learn more about handling their personal finances, their own knowledge and skills are low. Most receive little, if any, formal education about finances, and have little confidence about their financial abilities. Nevertheless, they face challenging decisions that can significantly affect their financial health and security. While they recognize that they need more knowledge, several barriers limit their ability to gain more financial skills, including the lack of time, confidence and appropriate, accessible learning opportunities.

Research on teaching adults

A summary of research by Ron and Susan Zemke is widely used as a practical guide for instructors of adults. (See “30 Things We Know For Sure About Adult Learning,” Innovation abstracts, Vol. VI, No 8, March 9, 1984) The Zemkes conclude that:

• Adults tend to enrol in learning programs to get knowledge and skills they need for a specific purpose or to cope with a serious issue. In financial education, this may be to deal with a credit or budget problem, or to prepare for a major life event such as a home purchase or pension planning. Learning should make strong and direct links to solving the problems that brought the learners to the program.
• Self-esteem and pleasure are strong secondary motivators for adult learners, helping them maintain interest, especially when it relates to their primary objective. Financial education that gives learners a sense of accomplishment and mastery of useful skills will keep them engaged and strengthen learning. Learners should have opportunities to demonstrate their skills and to appreciate what they have learned. Esteem can also be a de-motivator if learners feel foolish or ignorant, so interactions should allow learners to feel safe and respected, even when they are wrong. They may take errors personally.
• Adults prefer a practical, how-to approach that focuses on one thing at a time, linked to concrete examples and points of practice. Trying to cover too much, or speeding through material, can be counter-productive. Each significant point should have a concrete example, and each topic area should give learners a chance to apply their learning with a simulation, worksheet or discussion, and to integrate new ideas with what they already know.
• Because adults come looking for specific knowledge, they expect that a learning program will provide it, and will get frustrated or distracted if they do not see how the program meets their expectations. It’s helpful to get a clear idea of expectations and to explain how the program will (or will not) meet them.
• Wherever possible, it is helpful to build on learners’ existing knowledge. For example, most people have at least basic knowledge about paying bills and managing expenses, which forms a starting point for creating a more complex household or savings budget. By contrast, new information that learners have little knowledge or experience about will take more time to transmit. It is important, therefore, either to look for connections that learners can build on or to allow extra time for them to absorb and work with new concepts.
• People often have many false, biased or incomplete beliefs about personal finances, which can make it harder to learn new information and ideas. Learners should have a chance to express their existing beliefs so that instructors can address them by pointing out sources of error and providing authoritative knowledge.
• Because adults have a wide range of experiences to draw on, the learners themselves can be a valuable learning resource. Many, for example, will have examples of financial mistakes that they could be willing to share through open-ended questions, class discussion and small group sessions. They can also provide examples of where specific knowledge or skills have proven valuable.
• Learning experiences have to be flexible and open to learners with different viewpoints, different life stages and different values. The financial experiences and values of newcomers to Canada are different from those of recent secondary school graduates and those of workers with many years of work experience. Instructors need to be attentive to the range of learning styles and needs and be able to adapt their presentations to include as many different learners as possible. Small groups and individual assignments of various types will give instructors opportunities to address a range of specific needs.
• Finally, the physical and psychological learning environment can have a significant impact. Financial topics can be challenging and (for some) tedious, allowing learners to become easily distracted. Breaking topics into short segments with different types of activities, such as direct presentations, demonstrations, videos, on-line research, discussions, worksheets, hands-on activities, small groups, etc., will help keep learners engaged.

According to Zemke and Zemke, in an ideal learning experience, the instructor plays the role of a facilitator helping learners take concrete steps toward their objectives rather than a dispenser of knowledge. “The instructor must balance the presentation of new material, debate and discussion, sharing of relevant student experiences, and the clock. Ironically, it seems that instructors are best able to establish control when they risk giving it up. When they shelve egos and stifle the tendency to be threatened by challenge to plans and methods, they gain the kind of facilitative control needed to effect adult learning.”

Finding this balance is a challenge for personal finance instructors, when there is much critical information to present in a limited time. However, learners will gain more if they are able to take time to get a sound grounding in basic principles than if they are exposed to a wide range of facts and advice but retain little of it.

Approach taken in Your financial toolkit

The educational approach used in Your financial toolkit reflects the principles outlined above.

• Materials are divided into short segments.
• They are modular, allowing learners to choose what, and how much, they want to learn at a time.
• The information and activities are focused on practical knowledge and skills that will help learners resolve everyday financial issues.
• The concepts are illustrated with examples and case studies to help learners better understand the ideas and relate the concepts to their own experience.
• They provide information and activities in a way that gives learners an opportunity to review, apply, discuss and reflect on the topics and to practice new financial skills.
• They present information and teach skills in a variety of written, visual and interactive ways to engage learners and accommodate different learning styles.
• They point learners to resources where they can find further information and additional tools to enhance their financial management.