Financial Well-being: The Goal of Financial Education

Consumers of financial products and services need both a safe, transparent marketplace, and the financial capability to navigate that marketplace effectively. The Consumer Financial Protection Bureau (CFPB) addresses the first aspect through its supervision, enforcement, rulemaking, and other functions. Helping consumers acquire financial capability is also an integral part of the CFPB’s consumer financial protection mission, as reflected in numerous provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The Act charges the Bureau with researching, developing, promoting, and implementing financial literacy programs and activities.1 In this report we describe our initial research – conducted with a team of expert researchers2 – into how people acquire financial capability, which we undertook specifically to inform financial education and improve consumer outcomes. Our overarching objective is to determine how to define and measure the success of different financial literacy strategies so that we have a basis for measuring different strategies’ effectiveness. And for this, we need to define the end goal of financial education.