Financial educators promote the use of financial management practices by families and individuals to improve their financial well-being. Simply increasing knowledge of financial management principles does not insure that a person will be a more effective financial manager. Knowledge must be applied. The purpose of this study was to assess the effectiveness of the Women's Financial Information Program (WFIP) in promoting the adoption of financial management practices by participants in three states.

A few studies (DeVaney, Gorham, Bechman & Haldeman, 1995, 1996; Jeries & Allen, 1991; Titus, Fanslow & Hira, 1989; Varcoe & Wright, 1989) have shown the positive effects of using selected financial management practices. Effective financial management as defined by Schnittgrund and Baker (1983) combines financial management practices and outcome results such as the type of budget used, the frequency of saving, and the frequency of financial management problems in the family. Research shows that consumers believe financial management practices like budgeting and saving are valuable (Davis, 1987; Godwin & Carroll, 1986; Mullis & Schnittgrund, 1982; Schnittgrund & Baker, 1983). But, most studies relating to financial management practices identify the audience using recommended financial management practices rather than the results of using the practice.

Characteristics of those who adopt recommended management practices have been the topic of previous research. Beutler & Mason (1987) studied factors associated with using formal budget planning. They found that young, married, and well-educated households with high demand on available resources were more likely to adopt the practice of written budgets. Level of income did not significantly effect the practice of budgeting, according to Beutler and Mason. More families who budgeted their money, compared to families who did not budget, believed that they could increase their satisfaction with financial management by planning expenditures (Mullis & Schnittgrund, 1982)

Rosenfeld and Neese-Todd (1993) showed that most aspects of the quality of satisfaction with financial status are related to the individual's perception of their control over finances. Women, more often than men, view themselves as powerless and lacking essential resources to be able to make changes in their lives (Burman, 1994). Cox (1991) states that support groups are a viable means of empowering women who are marginalized mainly because of illiteracy. Support groups provide a social experience for sharing personal stories as a means of understanding their experiences, finding their own voices, and raising their self- esteem. Group process is a powerful means of imparting knowledge, assisting decision-making and affecting change (Yalom, 1985; Cox, 1991).

Even though financial management practices have been proven to increase net worth and satisfaction with financial resources, there is evidence of resistance and failure of consumers to adopt such practices (Beutler & Mason, 1987; Davis, 1988; Godwin & Carroll, 1986; Schnittgrund & Baker, 1983). Davis (1988, p. 47) suggests that "even affluent households do not see the balance sheet as a useful financial tool". Although audiences indicate a high interest in a topic, few take action on their beliefs (Iams, Steinfelt, & Wilhelm, 1986; McKenna & Nichols, 1988).

Davis (1987) found that lack of time and knowledge were the two reasons most often given for not using recommended practices of budgeting, record keeping, comparing records to the budget, and preparing a balance sheet. The need for budgeting financial resources and wise use of credit are most often felt by those with low personal incomes or who are in debt. To encourage adoption of financial management practices, Walker, Tremblay and Parkhurst (1984, p. 429) recommend that educational programming be "inexpensive, uncomplicated, and readily accessible". The purpose of this study was to determine those characteristics of financial management education that promote adoption of recommended financial practices.

The study model was based on systems theory where inputs in the form of resources, attitudes, and goals are transformed by one or more continual processes into outputs of achieved goals and met demands (Deacon & Firebaugh, 1988). Inputs in the study include age, marital status, education level, employment status, income, satisfaction with personal financial situation, and financial practices completed prior to program enrollment. Throughputs consist of the individual's perception of competency in managing finances, use of program workbooks, and influence of other participants in the group setting. Output is the adoption of recommended financial management practices. Examples of recommended financial practices include record keeping, goal setting, spending plans, funds for emergencies, wise use of credit, regular savings, insurance, retirement plans, and investments.

WFIP was developed by AARP and implemented by Cooperative Extension Services throughout the United States since 1987 (American Association of Retired Persons, 1992). WFIP encourages participants to take personal responsibility for financial management decisions through a series of lessons featuring speakers, workbooks, and small group discussions. At each session of the seven-week series, participants listen to invited professionals speak on topics suggested in the program materials. Then participants meet in small groups for discussion of workbook lessons and the speaker's comments. If additional information is needed, participants are encouraged to contact financial professionals to seek answers and to share findings at the next meeting. This study differs from the format suggested by AARP in the use of both a pre- and a post-assessment instead of using only a post-assessment.

Participants were self-selected and recruited through brochures, newspaper articles, advertisements, and referrals from former participants. Data were collected from participants by Extension educators in three states (Indiana, Nevada, and Utah) between Fall, 1993 and Spring, 1996. A pre-assessment was administered during the first session. Data for the post- assessment were collected by a mailed instrument three to six months after the last session using a modified form of the procedure developed by Dillman (1978). Only those who responded to both assessments were included in the sample. The instruments were adapted slightly from previous studies and were pre-tested with a small sample of WFIP program participants prior to their use with the larger sample.

The pre-assessment used eight questions to assess satisfaction with personal financial management. A Likert scale ranging from 1 to 6, Very Dissatisfied to Very Satisfied, was used to indicate satisfaction with income, money for necessities, money for emergencies, current savings, amount owed, money available for future needs, the way money is handled, and who handles the money. Other questions requested information about gender, age, marital status, ethnicity, education, employment status, and income.

The post-assessment included two questions about completion of workbook exercises during and after participation scored on a Likert scale from 1 to 5, None to All of Them. Ten statements, using a Likert scale from 1 to 4, Strongly Disagree to Strongly Agree, measured perceptions of financial competency defined as level of confidence to manage and achieve goals, anxiety about their situation, comfort about spending, ease of decision making, ability to set priorities and appropriate goals, seek assistance, solve problems, and to positively affect their financial position. Higher scores indicated increased confidence in handling financial matters since beginning WFIP. The influence of the small group was scored from 1 to 4, Not At All to Strong and Significant Influence.

The dependent variable, number of financial practices completed during or after WFIP, could range from zero to 27. Practices included setting up a record keeping system, developing or revising a spending plan, assessing the adequacy of insurance coverage, and review or establishment of an investment plan.

Data were analyzed using SPSS (Statistical Package for Social Sciences). Frequencies and means were obtained to describe the sample. Multiple regression was used to identify the determinants of financial management practices adoption. Tests for multicollinearity yielded no highly correlated variables.

The response rate was 54.4% based on 1,544 pre-assessments and 840 post-assessments. There were no significant differences between those who completed only the pre-assessments and those who completed both the pre-and post-assessments. Of the 576 usable responses (able to be matched), 38.2% were from Indiana, 37.3% from Nevada, and 24.5% from Utah. The majority (96%) were white females. Ages ranged from 20 to over 75, with almost half (48.9%) between 45 and 64 years. Almost two-thirds (63%) were married. Seventy percent had more than a high school education. Over half (56.2%) were employed full- or part-time. The majority (75.1%) had personal incomes between $10,000 and $49,999. The average number of financial practices that were adopted was 11.62.

The results of multiple regression analysis showed that age, financial practices completed prior to WFIP, workbook completion during and after WFIP, and perception of personal financial competency significantly predicted the number of financial practices adopted. These factors explained 49.6% of the variance in the number of financial practices adopted (F = 20.551; d. f. = 11, 230; p = .001). See Table 1.

The older the participant, the greater the number of financial management practices adopted. The discretionary time, urgency, and need for adopting financial management practices are likely to be greater as one ages. Increased adoption of recommended practices was significantly affected by completion of workbook exercises during and after participation. Program coordinators should strongly encourage the use of the workbook. As perception of personal financial competency increased, the number of financial practices adopted increased. Understanding the importance of perceptions is an important contribution of this study.

Those who completed more actions prior to WFIP adopted fewer recommended financial management practices during and after WFIP. This seems reasonable. Financial management is a continual processing of information as circumstances change (Deacon & Firebaugh, 1988). The study, however, did not distinguish between an action ever completed and subsequent processing (updating) needed. In future studies, data could be collected on when the action was last completed, level of satisfaction with task, and conditions to be satisfied (that is, more knowledge, time, income) before task can be done to their satisfaction.

WFIP was designed to improve the financial well-being of individuals and families. Participants receive challenges to adopt successful financial management practices from professional speakers, use the workbook, and actively participate as a member of a small group. It is important for financial management educators to understand the conditions supportive of adoption of financial management practices. Then educators can target programs effectively, obtain the most effective speakers, and encourage participants to use the workbooks during and after the series of lessons.

Continued research is needed to determine additional factors affecting program effectiveness. It may be useful to compare the number of recommended practices adopted in a larger sample to see if findings are consistent among participants.

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