A groundswell of interest in young people’s ability to understand and handle financial decisions has generated keen interest in financial knowledge and effectiveness of financial education. This study examines an innovative four-year school-based financial education and savings program, called “I Can Save” (ICS). Using a quasi-experimental design, the study examines quantitative and qualitative data to analyze program effects on financial knowledge. Elementary school children who participated in ICS scored significantly higher on a financial literacy test taken in fourth grade than comparison group students in the same school, regardless of parent education and income. Results suggest that young children increase financial capability when they have access to financial education and it is accompanied by participation in meaningful financial services.
Sherraden, Margaret. S., Johnson, L., Guo, B. and Elliott, W. (2010). Financial capability in children: Effects of participation in a school-based financial education and savings program. Journal of Family and Economic Issues, 32(3), 385-399.
This paper explores young children's perceptions and expectations about attending college, and the potential influence of a savings program on shaping children's perceptions about paying for college. As part of a four-year study of a school-based college savings program called “I Can Save”, this paper uses qualitative evidence from interviews conducted in second and fourth grades with a diverse group of 51 children. Findings suggest that most of the children in the study have a general understanding of college and have begun a process of considering higher education. Further, children in “I Can Save” are more likely than a comparison group of children to perceive that savings is a way to help pay for college.
Elliott, W., Sherraden, M., Johnson, L. and Guo, B. (2010). Young children's perceptions of college and saving: Potential role of child development accounts. Children and Youth Services Review, 32(11), 1577-1584.
This paper examines an innovative college savings program for public elementary school children. The project is based on the proposition that children will gain financial knowledge and be more likely to view college as an attainable goal because they are accumulating savings to help pay for higher education. As the latest in a long history of school-based savings programs, this program pioneers the idea of matched savings in which children and family savings in the students' accounts are matched one to one up to a maximum of $3000. Findings suggest that the principal, teachers, children, and their families are enthusiastic about the program. Saving patterns show that families can save, but low levels and patterns of saving suggest that structures that encourage regular saving might improve saving rates. The program successfully teaches financial education through an after-school club, but it has been more difficult to incorporate it into classroom teaching and to reach parents. Universal children's savings accounts may circumvent some of the limitations of this program, although more research is required to assess which program components would be the most effective in such a system.
Sherraden, Margaret. S., Johnson, L., Elliott, W., Porterfield, S., and Rainford, W. (2007). School-based children’s saving accounts for college: The I can save program. Children and Youth Services Review 29, 294-312.