Skip to main content

Visual tools and narratives: New ways to improve financial literacy (Lusardi et al., 2017)

Absence of conflict of interest. 

Citation

Lusardi, A., Samek, A., Kapteyn, A., Glinert, L., Hung, A., & Heinberg, A. (2017). Visual tools and narratives: New ways to improve financial literacy. Journal of Pension Economics & Finance, 16(3), 297-323. https://doi.org/10.1017/S1474747215000323 [Interactive visual tool]

Highlights

  • The study’s objective was to examine the impact of financial literacy training provided in four different formats (video narrative, written narrative, informational brochure, and interactive visual tool) on financial literacy knowledge. This profile focuses on the interactive visual tool training. The authors investigated similar research questions for other formats, the profiles of which can be found here.
  • The study was a randomized controlled trial where adults were randomly assigned to a treatment group where they received one of the four types of financial literacy training, or to the control group where they did not receive any training. Using an online questionnaire, authors compared financial literacy knowledge scores between each of the treatment groups and the control group.
  • The study found that those who participated in the interactive visual tool training had a significantly lower proportion of answers they reported they did not know as compared to the control group.
  • The study receives a high evidence rating. This means we are confident that the estimated effects are attributable to the interactive visual tool training and not to other factors.

Intervention Examined

Interactive Visual Training for Financial Literacy

Features of the Study

The authors tested online financial literacy trainings that were designed to increase knowledge about financial risk diversification, with adults aged 20 years and older. They developed four different modes of the training to understand which were most effective at improving trainees’ financial knowledge: a video narrative, an informational brochure, a written narrative, and an interactive visual tool. The video narrative and written narrative both taught financial literacy content through sharing a story that conveyed the information, but differed in whether the story was delivered through a text format or through a video format with the story acted out. The interactive visual tool and informational brochure both shared information by presenting graphics and analytics; however, the visual tool allowed trainees to interact and adjust the graphics while the brochure presented the information in a static format that did not allow for interactivity.

The study was a randomized controlled trial, where outcomes for each treatment group were compared with outcomes for the control group that did not receive any training. There were 892 individuals recruited from a survey panel called the American Life Panel (ALP). The individuals were randomly assigned to either the control group (n=388) or to one of the treatment conditions: the video narrative (n=115), the informational brochure (n=127), the written narrative (n=133), or the interactive tool (n=129). The study took place online over a four-month time period. Training participants completed a written questionnaire after participating in the training that measured financial knowledge, while the control group completed the same written questionnaire without participating in the training. The study used statistical analyses to compare outcomes between each of the treatment groups and the control group, controlling for demographic differences (gender, age, family income, work status, education, race/ethnicity) between groups. These analyses were conducted twice for each training mode: first for the whole treatment group, and then only for those in the treatment group who reported that they were able to access the training; in some cases, the trainees were not able to access the training due to technical difficulties.

Findings

Knowledge and skills for financial decision making

  • The study did not find a significant difference in the number of correct answers between the trainees who participated in the interactive visual tool training and the control group. However, interactive visual tool participants had a significantly lower proportion of answers they reported they did not know compared to the control group.

Considerations for Interpreting the Findings

Some of the participants could not access the training due to technical difficulties. This might have created systematic differences between the treatment and control groups. The authors responded by adding a question as to whether they could access the training, and calculating both intent-to- treat and treatment-on-treated effects. However, this question was only added mid-way through the study.

Causal Evidence Rating

The quality of causal evidence presented in this report is high because it was based on a well-implemented randomized controlled trial. This means we are confident that the estimated effects are attributable to the interactive visual tool training and not to other factors.

Additional Sources

Lusardi, A., Samek, A. S., Kapteyn, A., Glinert, L., Hung, A., & Heinberg, A. (2014). Visual tools and narratives: New ways to improve financial literacy (NBER Working Paper No. 20229). https://www.nber.org/system/files/working_papers/w20229/w20229.pdf

Reviewed by CLEAR

June 2023

Topic Area