Financial literacy

Current and Completed Projects:

Life After High School Ontario – Phase III

The purpose of Life After High School is to improve the rates at which high school students transition to post-secondary education by reducing the non-financial and financial barriers students face. The program applies lessons from behavioural economics to provide all Grade 12 students at selected Ontario secondary schools with practical support applying for post-secondary education and financial aid. Students are guided through online tools and video in the process of selecting a post-secondary program of their choice, applying for a place in that program without incurring a fee, and applying for financial aid. As options are considered for the delivery of a streamlined Life After High School program in Ontario in future years, SRDC is running the program in 69 low-transition schools in 2016-17.

Start-end date: September 2016 - June 2017
Sponsor: Ontario Ministry of Advanced Education and Skills Development

Personal income information for disabilities assistance recipients

This project develops a state-of-the-art income calculator website for British Columbians receiving disability assistance (PWDs) and trains employment services centre case managers in its use. The site is designed to improve access to accurate income information for PWDs, including (a) income estimations for specific job opportunities and (b) a personal account where they can keep track of their earning exemption totals and see the effect that earnings have on their Disability Assistance payments. Case managers introduce their PWD clients to the tool and help them to enter the required information. The project aims to improve clients’ understanding of the effect that earnings and moving in and out of work will have on their Disability Assistance Benefits and overall income. It should raise their confidence in the financial consequences of their employment decisions and reduce financial apprehension when moving into employment. The project is designed as an experimental demonstration to quantify the impact of implementation of the Income Calculator on PWDs’ financial security, their willingness and motivation to seek employment opportunities, and improvements in their medium-to long-term employment outcomes.

Start-end date: February 2016 - January 2019
Sponsor: British Columbia Ministry of Social Development and Social Innovation

The role of financial literacy on financial decisions and retirement preparedness among seniors and older adults

Recent evidence suggests that many seniors and older adults may struggle to manage their finances. On assessments of financial capability, Canadian seniors and older adults fared poorly on objective measures of financial knowledge including those with high self-rated skills. These gaps may have serious consequences for financial decision-making, particularly among those heading into retirement. This project analyzes the 2014 Canadian Financial Capability Survey (CFCS) to understand the challenges that Canadian seniors and older adults face with financial literacy, how these relate to financial outcomes, and retirement preparedness.

Start-end date: September 2015 - March 2016
Sponsor: Financial Consumer Agency of Canada

The role of subjective attitudes and beliefs in financial decision-making of Canadians

While many Canadians lack basic financial literacy, mounting evidence from behavioural economics suggests that financial decisions are also frequently undermined by psychological factors. Even with the requisite financial knowledge and literacy skills, people are prone to various kinds of cognitive biases when making financial decisions such as those related to evaluating risk and uncertainty or the time value of money. This project undertakes an analysis of the 2014 Canadian Financial Capability Survey (CFCS) with the aim of understanding the role of cognitive biases in the financial decision-making of Canadians, with a particular focus on youth, aboriginals, and those with low incomes.

Start-end date: September 2015 - March 2016
Sponsor: Financial Consumer Agency of Canada

Long-term impacts of the Life After High School program in BC

This project extends analysis from SRDC’s previous study of the Impact of Lowering Non-financial Barriers on Access to Post-secondary Education (Life After High School) in British Columbia. The intervention tested a sequence of three workshops delivered to high schools’ Grade 12 students intended to encourage the students to apply for post-secondary education and related student financial aid. A total of 50 BC high schools with low rates of students entering post-secondary education are involved. Impacts on students’ enrolment and persistence in post-secondary education, use of student financial aid and program choices are investigated across key subgroups defined by Aboriginal status, gender and high school achievement.

Start-end date: January 2015 - January 2016
Sponsor: Max Bell Foundation

Life After High School Ontario – Phase II

A pilot project to develop and test streamlined options for delivery of the Life After High School program in Ontario. The program options provide Grade 12 students at selected Ontario secondary schools with practical support applying for post-secondary education and financial aid. Students are guided through online tools and video in the process of selecting a post-secondary program of their choice, applying for a place in that program, and applying for financial aid. In the initial stage of the project, SRDC provided consulting services and a set of recommended models for test, including consideration of a variant model for Crown Wards. Following the selection of preferred models, the second stage commenced delivery of the options during the 2013-14 school year. Delivery models vary in order to assess the impact of paying the application fee of either the Ontario College Application Service (OCAS) or the Ontario Universities Application Centre (OUAC) and different forms of facilitation. This research project seeks to learn which models are most effective in supporting all Grade 12 students at a school to make applications for post-secondary studies and financial aid, and in increasing enrolment in further education.

Start-end date: April 2013 - March 2016
Sponsor: Ontario Ministry of Training, Colleges and Universities

Manageable Student Debt Threshold Research

This project assesses current understanding on levels of manageable student debt. It begins with a review of existing theoretical and empirical evidence, both national and international, and an environmental scan of the existing practices in defining and measuring manageable student debt. Current private and public sector practices on definition, calculations, and measurements of manageable debt are gathered through key informant interviews with private sector loan providers, credit agencies, and debt counselling representatives. Data analysis of individual level microdata from Statistics Canada is used to estimate various manageable student debt thresholds, corresponding to those identified in the initial review.

Start-end date: January 2013 - March 2013
Sponsor: Alberta Enterprise and Advanced Education

Investor Education Fund Review

In collaboration with Susan Murray and Associates, SRDC conducted a review and assessment of the Investor Education Fund’s goals, strategic priorities, activities, and programs. Key objectives for the review included benchmarking IEF activities against those of peer organizations with comparable mandates; aligning IEF programs and activities with its goals, priorities, and mandate; and making recommendations to ensure optimal alignment, performance, and accountability.

Start-end date: October 2012 - December 2012
Sponsor: Anonymous sponsor

Predicting Student Loan Delinquency and Default

This project develops a model to predict student loan delinquency and default based on borrower characteristics using administrative data. The goal is to improve the targeting of at-risk borrowers and improve the efficiency of program resources devoted to reducing student loan default. The work involves documenting the theoretical and empirical evidence to date, a thorough data assessment to identify key variables, statistical modelling of loan delinquency and default, calculating probabilities for different borrower characteristics, and comparing again to the literature to identify discrepancies and new findings.

Start-end date: October 2012 - March 2013
Sponsor: Human Resources and Skills Development Canada

Needs Assessment Simplification

This project seeks to identify options to simplify student financial aid (SFA) applications in Canada. It does this by assessing the scope for limiting or modifying the data elements currently collected to determine SFA offers. The main analysis involves data on actual applications and awards. SRDC simulates revised aid offers to assess the role played by each data element in determining the level and composition of actual aid offers made and runs sensitivity tests for different student sub-groups to assess their vulnerability to the removal or modification of each element. The simulations and sensitivity tests are undertaken at both a national and a provincial level. Based on these findings and a review of the literature, a range of simplification options are presented along with the pros and cons of each, including a range of possible effects on program costs.

Start-end date: September 2012 - March 2013
Sponsor: Human Resources and Skills Development Canada

Understanding the impact of numeracy and literacy skills on financial capability

In collaboration with the Financial Consumer Agency of Canada, this SRDC study explores the link between Essential Skills and financial capability as well as the impact of workplace-based Essential Skills training on financial capability. Financial capability is defined as the ability to make informed financial decisions. This research study is part of the broader UPSKILL: Essentials to Excel demonstration project and aims to provide a better understanding of the relation between two domains of financial capability (managing money and planning ahead) with the TOWES essential skills scores (numeracy and document use). The study also explores other links between financial capability and important psycho-social outcomes and job performance indicators.

Start-end date: September 2012 - February 2014
Sponsor: Financial Consumer Agency of Canada

Life After High School in Ontario

A pilot project to test an innovative program called Life After High School in Ontario. Starting in October 2011, the program provides Grade 12 students at selected Ontario secondary schools with practical support applying for post-secondary education and financial aid. In three on-line facilitated workshops at 43 schools, students are guided through the process of selecting a post-secondary program of their choice, applying for a place in that program, and applying for financial aid. The application fee of either the Ontario College Application Service (OCAS) or the Ontario Universities Application Centre (OUAC) is covered by the program. This research project seeks to learn whether supporting all Grade 12 students at a school in making real applications for post-secondary studies and financial aid increases enrolment in further education.

Start-end date: May 2011 - March 2015
Sponsor: Ontario Ministry of Training, Colleges and Universities

Financial Literacy of Low-income Students

This project seeks to inform the Higher Education Quality Council of Ontario about the relationship between financial literacy and post-secondary access for low-income youth, and what programs may be implemented to help youth overcome the financial literacy barrier in attending PSE. The first part consists of a literature review of research related to the financial literacy of low-income high-school students with respect to their decisions about post-secondary attendance. The second part consists of an environmental scan of programs that have been implemented to raise financial literacy among low-income youth with respect to post-secondary attendance.

Start-end date: January 2011 - May 2011
Sponsor: Higher Education Quality Council of Ontario

Impact of Lowering Non-financial Barriers on Access to Post-secondary Education (Life After High School)

The project aims to develop, implement, and test an intervention to find new ways to lower non-financial barriers on access to post-secondary education. The intervention targets British Columbia high schools with low rates of students entering post-secondary education. A sequence of three workshops delivered to the schools’ Grade 12 students have the intent of encouraging the students to apply for post-secondary education and related student financial aid.

Start-end date: March 2010 - March 2013
Sponsor: Human Resources and Skills Development Canada + Carthy Foundation

Labour Market Information to Help High-School Students Access Post-secondary Education: The “Life After High School Experiment”

Concept paper to assess whether the process of providing information to high-school students about labour markets, their post-secondary options, potential post-secondary program acceptance, and eligibility for financial aid can improve knowledge acquisition and human capital acquisition.

Start-end date: March 2009 - May 2009
Sponsor: Human Resources and Skills Development Canada (Policy Research)

Willingness to Pay for Post-secondary Education Among Under-represented Groups

A study to evaluate high-school students’ debt aversion or willingness to incur debt to access post-secondary education. The study focuses in particular on the decision-making process of youth from low SES families, Aboriginal families, and rural sectors, and on first generation students. Participants are tested for numeracy, risk, and time preferences. A sample of 1,400 students in 14 schools across 4 provinces took part in this project.

Start-end date: May 2007 - December 2009
Sponsor: Canada Millennium Scholarship Foundation
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Research Support for Dissemination: Early Analyses of Future to Discover Baseline Data

In advance of planned publication, the Future to Discover evaluation team undertook early analysis of Future to Discover’s two recruited cohorts from New Brunswick and one cohort from Manitoba, prepared tables for three conferences and presented at the conferences.

Start-end date: December 2005 - April 2006
Sponsor: Canada Millennium Scholarship Foundation

learn$ave: Individual Development Accounts Project

A demonstration project to evaluate, using random assignment, individual development accounts (matched saving accounts and financial literacy training) offered to low-income families to encourage adult learning activities and small business start-up; the project involved a total of some 5,000 low-income families in 10 communities, as well as non-profit organizations to coordinate and carry out service delivery and financial institutions to maintain the accounts.

Start-end date: June 2000 - March 2009
Sponsor: Human Resources and Skills Development Canada
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