From Clicks to Confidence: Using Quick Online Interventions to Increase Young Women’s Financial Confidence and Behaviours – A Gender Equality Research Brief

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Cat. No. FC5-93/2024E-PDF (Electronic PDF, English)

ISBN 978-0-660-74418-6

© His Majesty the King in Right of Canada, as represented by the Minister of Finance Canada, November 2024.

Aussi disponible en français sous le titre : Des clics qui donnent confiance : L’utilisation d’interventions rapides en ligne pour accroître la confiance et les comportements financiers positifs des jeunes femmes — Dossier de recherche sur l’égalité des sexes

Highlights

• In 2023, the Financial Consumer Agency of Canada (FCAC) and researchers from Carleton University developed and tested the effectiveness of brief, online interventions at improving the financial confidence, financial knowledge and positive financial behaviours of young women ages 16–25.
• Designed using behavioural science, these interventions challenged social norms that suggest women are less financially capable than men, and also encouraged young women to actively learn about new financial concepts.
• The interventions were effective at increasing the financial confidence of young women. Specifically, women who received any of the interventions had higher financial confidence 1 week later compared to women who did not receive an intervention.
• Of note, all women in the study, even those who did not receive an intervention demonstrated increased financial confidence and positive financial behaviours 1 month later. Simply reflecting on their financial attitudes, knowledge and behaviours enabled participants to feel more confident.

Foreword

Starting at a young age and continuing throughout their lives, women report feeling less financially confident than men.^{Footnote 1},^{Footnote 2}  Even when women score just as well as men on measures of financial knowledge, they still experience lower financial confidence.^{Footnote 3}  Financial confidence is an important trait that is linked with many positive financial behaviours such as budgeting, building up savings, keeping up with bills, and retirement planning.^{Footnote 4},^{Footnote 5}  Experiencing low financial confidence may lead women to be financially unprepared or make financial decisions that are not suitable for their needs, putting them at a disadvantage.

Bias, discrimination and systemic barriers to financial inclusion are some of the reasons women and girls are highlighted within Canada’s National Financial Literacy Strategy as a population that can benefit from tailored approaches to strengthen financial resilience. Recognizing the value of tailored approaches, FCAC held an intervention in 2022 with online platform ChatterHigh to deliver gamified courses that boosted participants’ financial knowledge and built their confidence in managing money, especially for girls. To continue this line of research, the Financial Consumer Agency of Canada sought to develop and test the effectiveness of additional online interventions aimed at increasing the financial confidence and associated positive financial behaviours of young women over time through a study with Carleton University.

Methodology

In collaboration with researchers from Carleton University, FCAC developed two brief online interventions that were informed by behavioural science and could be delivered in approximately 5 minutes:

• Recall and Share: In this intervention, women browsed an online forum with real stories from young women describing times when they felt financially confident. After reading these stories, participants were asked to recall and share a story of their own about financial confidence and add it to the forum.
• Find and Explain: In this intervention, women searched online for definitions of new financial concepts and then re-wrote the definitions in their own words. They then added their newly created definitions to an online user-created dictionary of financial terms.

From May to December 2023, FCAC recruited 1,119 young women aged 16–25, from across Canada, to participate in a study which tested the effectiveness of these interventions at improving financial confidence, knowledge and associated positive financial behaviours over time.

After signing up for the study, participants first completed a series of surveys that included measures of financial worries, financial confidence, and financial behaviours. Participants were then randomly assigned to one of four intervention conditions:

• Control condition – participants received no intervention
• Recall and Share condition
• Find and Explain condition
• Both conditions – participants received both the Recall and Share and Find and Explain interventions

Financial confidence was then measured immediately after the intervention, 1 week later, and 1 month later. Financial worries were measured 1 week and 1 month later, and financial behaviours (e.g., making a credit card payment, contributing to a savings account, adhering to a budget) were measured 1 month later.

Key findings

Overall, the young women who participated in the study experienced boosts in their financial confidence and responsible financial behaviours, and these effects could still be observed up to 1 month after the study. Participating in the study helped women feel more self-assured in dealing with their finances and encouraged them to engage in positive financial behaviours such as starting to pay off their debts, contributing to their savings, or creating and sticking to a budget.

The most notable findings from the study were as follows:

1. The interventions were effective at boosting the financial confidence of young women, and this effect was still observed 1 week later. Women who were asked to share a personal story of financial confidence (Recall and Share condition), define a financial concept in their own words (Find and Explain condition), or complete both activities (Both condition), demonstrated an immediate increase in financial confidence compared to women in the control group. Moreover, even after 1 week had passed, women who received any of the (3) interventions continued to demonstrate higher financial confidence. Additionally, although the effect was small, women who were asked to both share a personal financial confidence story and define a financial concept in their own words (Both condition) continued to exhibit higher financial confidence compared to the control group 1 month later.

Figure 1. Between Conditions Effects - Financial Confidence

Note: * denotes that the difference in results is statistically significant (p < 0.05). Immediately post-intervention and 1 week later, all three intervention groups had higher levels of financial confidence compared to the control group. Additionally, 1 month later, women who received both interventions continued to have higher financial confidence compared to the control group, though the effect was small.

2. The longer the young women participated in the study, the more their financial confidence grew. Participants in all conditions, even those in the control condition who received no intervention, reported further boosts to financial confidence as their time participating in the study increased, with the highest levels of financial confidence observed 1 month after receiving the interventions. This may be because all participants, regardless of condition, were asked to complete questionnaires on their financial knowledge, financial confidence and positive financial behaviours. Simply reflecting on their financial understanding and behaviours seemed to have helped participants feel more assured and confident in their financial capabilities.

Figure 2. Changes in Financial Confidence Over Time

Note: * denotes that the difference in results is statistically significant (p < 0.05). The sample continued to demonstrate statistically significant improvements in financial confidence over time.

3. The longer the young women participated in the study, the more their financial worries lessened. Participants in all conditions, even those in the control condition who didn’t receive any intervention, reported their financial worries decreased as their time participating in the study increased, with the lowest levels of financial worries observed 1 month after receiving the interventions. Similar to changes in financial confidence, it seems that the mere exercise of thinking about their financial knowledge and positive financial behaviours enabled participants to feel less worried about their financial situation(s).

Figure 3. Changes in Financial Worries Over Time

Note: * denotes that the difference in results is statistically significant (p < 0.05). Financial worries were significantly lower than the pre-intervention measure at both the 1 week and 1 month follow-up.

4. The longer the young women participated in the study, the more they engaged in positive financial behaviours. Participants in all conditions, even those in the control condition who received no intervention, increasingly engaged in positive financial behaviours as their time participating in the study increased, with the highest levels of debt repayment and savings contributions observed 1 month after receiving the intervention. These results support the conclusion that being prompted to think about their financial knowledge and positive financial behaviours enabled the young women to engage in more positive financial behaviours.

Figure 4. Changes in Financial Habits Over Time

Note: * denotes that the difference in results is statistically significant (p < 0.05). Compared to the pre-intervention measure, participants engaged in more positive financial habits one month later.

Conclusion

In this study, FCAC sought to test the efficacy of brief, online interventions at improving the financial confidence and positive financial behaviours of young women over time. The results of this work demonstrated that behaviourally informed interventions administered quickly and through digital platforms can be effective at increasing the financial confidence of young women and that these effects can have a lasting impact. Women who received any of the interventions had higher financial confidence than those who did not receive an intervention (i.e., control group) 1 week later. Additionally, those who were asked to both share a personal financial confidence story and define a financial concept in their own words continued to have higher financial confidence compared to the control group 1 month later, though this effect was small. The fact that all the brief 5-minute interventions were able to have a lasting effect 1 week after exposure provides strong evidence that tailored interventions are a promising tool for closing the gender gap in financial confidence.

An especially promising finding is that all women in the study, even those who did not receive an intervention, felt more financially confident and engaged in more positive financial behaviours the longer they participated. We hypothesise that this is because all participants, even those in the control condition, were asked to reflect on and answer questions about their financial knowledge, attitudes and behaviours. Simply taking the time to reflect on their finances may have helped participants feel more comfortable with finances, thereby boosting their financial confidence, decreasing their financial worries and encouraging positive financial habits.

These insights indicate that encouraging young women to openly reflect on and talk about their finances can play a crucial role in helping to strengthen their financial confidence. From an early age, parents, teachers, and other adults can play a crucial role in normalizing conversations about money with girls, which can go a long way towards building financial confidence that they will take into their adulthood. Further, these data also point to how low-cost, easy interventions can help begin to bridge the gender gap in financial confidence.

By working together, all stakeholders in the financial ecosystem can help create environments where women feel comfortable and secure sharing their thoughts and attitudes about money. Through investing in initiatives for young women, we can enable women to overcome financial barriers and achieve positive financial futures. Together, we can make change that counts.