Personal Financial Literacy in New Hampshire

In the spring of 2008, The Rockefeller Center Policy Research Shop published Policy Brief 0708-02, detailing statistics and policy options relevant to New Hampshire House Bill 1462, which sought to establish an Office of Personal Financial Education in the New Hampshire Treasury Department.

This policy brief expands upon the findings of PRS Brief 0708-02, primarily in exploring available data regarding the level of financial literacy of New Hampshire citizens and the need and efficacy of personal financial education in the New Hampshire public educational system.

The brief is based on the application and assessment of the basic theory underlying personal financial education:

NH Citizen --> Financial Literacy --> Financial Capability

Under this theory, when a New Hampshire citizen receives financial education, he/she will become financially literate, or knowledgeable of the basic skills, tools and systems involved in financial decision making. Once an individual has attained “Financial Literacy,” the theory then argues that he/she will be able to apply that literacy to achieve “Financial Capability,” or the ability to display sound judgment when faced with actual financial decisions.

This theory is explored throughout the brief, including its application to several relevant subsections of personal financial education such as:

• The State of Personal Finance in New Hampshire: Are New Hampshire citizens financially literate, and if so, are they then financially capable? Comparisons to national data reveal that New Hampshire consistently exceeds national financial indicators
• Personal Finance Programs and Curricula: What is the best level (student/adult) to implement personal finance programs? What kind of programs and curricula exist, and how do they go about fulfilling the theory? Public education provides the only guaranteed point of participation in these programs, and other states provide new models for New Hampshire to build upon.
• Data on Personal Financial Literacy: A national survey by the Jump$tart Coalition as well as a new survey by the Rockefeller Center Policy Research Shop reveals that although students in New Hampshire exceed national averages, they still fail to demonstrate financial literacy on survey instruments.
• Efficacy of Personal Finance Programs: Current research and studies on personal finance suggest the efficacy of these programs is mixed and inconclusive.
• Policy Recommendations: If New Hampshire plans to implement a new personal financial education program, it should be complete, integrated, applied and institutionally supported.