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Visual Tools and Narratives: New Ways to Improve Financial Literacy

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  • Annamaria Lusardi
  • Anya Savikhin Samek
  • Arie Kapteyn
  • Lewis Glinert
  • Angela Hung
  • Aileen Heinberg

Abstract

We developed and experimentally evaluated four novel educational programs delivered online: an informational brochure, a visual interactive tool, a written narrative, and a video narrative. The programs were designed to inform people about risk diversification, an essential concept for financial decision- making. The effectiveness of these programs was evaluated using the RAND American Life Panel. Participants were exposed to one of the programs, and then asked to answer questions measuring financial literacy and self-efficacy. All of the programs were found to be effective at increasing self-efficacy, and several improved financial literacy, providing new evidence for the value of programs designed to help individuals make financial decisions. The video was more effective at improving financial literacy scores than the written narrative, highlighting the power of online media in financial education.

Suggested Citation

  • Annamaria Lusardi & Anya Savikhin Samek & Arie Kapteyn & Lewis Glinert & Angela Hung & Aileen Heinberg, 2014. "Visual Tools and Narratives: New Ways to Improve Financial Literacy," NBER Working Papers 20229, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:20229
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    References listed on IDEAS

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    Cited by:

    1. Edward Hubbard & Percival Matthews & Anya Samek, 2016. "Using online compound interest tools to improve financial literacy," The Journal of Economic Education, Taylor & Francis Journals, vol. 47(2), pages 106-120, April.
    2. Calderone, Margherita & Fiala, Nathan & Mulaj, Florentina & Sadhu, Santadarshan & Sarr, Leopold, 2014. "When Can Financial Education Affect Savings Behavior? Evidence From A Randomized Experiment Among Low Income Clients of Branchless Banking in India," Working Papers 32, University of Connecticut, Department of Agricultural and Resource Economics, Charles J. Zwick Center for Food and Resource Policy.
    3. Sandro Ambuehl & B. Douglas Bernheim & Annamaria Lusardi, 2014. "A Method for Evaluating the Quality of Financial Decision Making, with an Application to Financial Education," NBER Working Papers 20618, National Bureau of Economic Research, Inc.
    4. Daniel Gray & Alberto Montagnoli & Mirko Moro, 2017. "Does education improve financial outcomes? Quasi-experimental evidence from Britain," Working Papers 2017010, The University of Sheffield, Department of Economics.

    More about this item

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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