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The Federal Government and Financial Capability

Louisa Quittman, Director, Financial Education, U.S. Department of the TreasuryEmail: Louisa.Quittman@Treasury.gov

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• 1 in 5 U.S. students (age 15) are below the baseline of financial knowledge proficiency per 2012 Programme for International Student Assessment (PISA)

• Fewer than 40% of U.S. adults can demonstrate higher levels of knowledge/application of basic everyday financial concepts (National Financial Capability Study)

• Emerging Research in Financial Education: • Starting Early Improved decision-making

Why focus on financial capability?

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• Comprised of 22 federal entities to coordinate and enhance federal financial education activities

• Promoting Financial Success in the U.S.: National Strategy for Financial Literacy (2011)

• www.MyMoney.gov – Online resource housing financial education materials and tools for children, adults, and educators• FLEC Research and Data Clearinghouse

Financial Literacy and Education Commission

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MyMoney.gov

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FLEC Strategic Focus: Starting Early for Financial Success

• Children and Youth• Integrating Financial Capability: A Toolkit for

Social Service Organizations• Building Financial Capability in Youth

Employment Programs• Encourage hands-on learning through school

savings programs

Financial Literacy and Education Commission

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Financial Literacy and Education Commission

FLEC Strategic Focus: Starting Early for Financial Success

• Post-Secondary Education• College Savings and Financing Resources• Financial Aid Toolkit

www.financialaidtoolkit.ed.gov/tk • Student Income-Driven Repayment Pilot• Testing Loan Counseling

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Financial Literacy and Education Commission

FLEC Strategic Focus: Starting Early for Financial Success

• Early Career and Planning for Retirement– Financial Education in the workplace– myRA

• Research and Evaluation – FLEC Research and Data Clearinghouse– Journal of Consumer Affairs: Special Issue -

March 2015

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More on Youth Savings

• Financial Education and Account Access Among Elementary Students

– Large effects of education on knowledge questions

– Moderate effects of in-school banking and education on attitudes

– Education and bank access boost bank account ownership by kids

– Effects persist

• Guidance to Encourage Financial Institutions’ Youth Savings Programs • Hands-On Learning to Build Financial Habits

– Federal Resources to Encourage School-Based and Youth Savings Programs

– Research and Resources on Child Savings

available at www.treasury.gov/resource-center/

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Other FLEC Agency Resources

• CFTC Smart Check - Interactive Video Quizzes- Diagnostic Investment Tools and

Resources - And more!

• FEMA Emergency Financial First Aid Kit

• Collect and secure important personal information in a central place– Household Identification– Financial and Legal Documentation– Medical Information– Household Contacts

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Issue Areas• Early Financial Education

for Children• Financial Decision-making

and Post-Secondary Education

• Innovation and Technology

• Cities and Communities

President’s Advisory Council on Financial Capability for Young Americans

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Financial Empowerment Innovation Fund

– 11 Research contracts awarded– Project Focus Areas:

• Informed Decision-Making in Higher Education• Promoting Innovations in Payments and Savings to

Promote Access• Financial Capability and Education in the Classroom

– More info can be found online at: http://www.treasury.gov/resource-center/financial-education/Pages/Finemp.aspx

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myRA Addresses a Serious Gap in Retirement Savings

The U.S. Department of the Treasury developed myRASM (My Retirement Account) to help people start saving for retirement.

• myRA is a simple, safe, and affordable starter savings account for people who do not have access or are ineligible for a retirement savings plan at work.

• Simple—savers can contribute any amount with an automatic payroll contribution by their employer.

• Safe—myRA investments will not go down in value and are backed by the U.S. Treasury.

• Affordable—myRA accounts have no start-up fees or maintenance costs for employees, and there are no costs to employers to offer the program.

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Join myRA: Call to Action

• Promote myRA– Create a link on your website to www.myRA.treasury.gov– Engage with myRA on social media—Twitter, Facebook, LinkedIn, YouTube

• Discuss myRA– Distribute myRA materials to your networks and clients – Inform employers in the private and non-profit sectors

• Incorporate myRA– Inform your regional staff, local partners, and state offices about myRA. – Highlight myRA in newsletters, events and other communications

• Join myRA– Contact the Treasury Department to become an Outreach Partner

For more information, visit myRA.treasury.gov

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More Information

• http://www.treasury.gov/resource-center/financial-education