Encouraging savings, rewarding effort

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Encouraging savings, rewarding effort

• Saver Plus Encouraging Savings and increasing
  financial capabilities among low-income families

Roslyn Russell, Sandra Mihajilo, Aruna Nair and
Robert Brooks
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This presentation..

• Provides an overview of the 2005 evaluation
  results of Saver Plus
• Highlights the key success factors of the program
• Gives current directions of Saver Plus

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Saver Plus

• Saver Plus is a program designed to help
  families on low income improve their levels of
  financial literacy, develop a savings habit and
  build assets for educational purposes

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Saver Plus

• Initiative of ANZ Banking Corporation and
  Brotherhood of St Laurence
• Delivered through partnerships with four
  community organisations
• Brotherhood of St Laurence (Victoria)
• Benevolent Society (NSW)
• Berry Street Victoria (Victoria)
• The Smith Family (QLD)

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Partnerships
Implementation Partners
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SP Design Features - Pilot

• Case management
• Recruitment
• Support
• Facilitate education
• Financial education
• 2 for 1 matching (limit 1000)
• Restricted goal Secondary School education costs

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Eligibility Criteria

• Health Care Card Holders(599 - 741p/week 34
  each child)
• Child in secondary school
• Some paid employment
• Demonstrated capacity to save

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Saver Plus locations numbers

• Four locations
• Frankston, Victoria 177
• Shepparton, Victoria 125
• Campbelltown, NSW 49
• Brisbane / Gold Coast 101
• Total 452
• (nos. of commenced, 408 completed)

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Evaluation Aims

• Degree of success in meeting savings goals
• Levels of improvement in financial capabilities
• Identify enabling / inhibiting factors for
  success
• Identify other flow-on effects from participating
  in the program

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Research process

• Questionnaire at commencement
• Questionnaire before undertaking financial
  education
• Final questionnaire
• Focus groups during program and three months
  after completion
• Interviews with staff
• Banking data

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Participant Numbers

• Total 452
• Analysis conducted on 399 participants
• 44 withdrew
• 11 did not want to take part in the research

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Demographics

• Average age 42 years
• 97.8 are female
• 32.56 couples
• 67.44 sole parents
• On average participants have 2.3 dependent
  children
• Average age of the child is 12 years

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Language, ethnicity and education levels

• 94.2 speak English as their first language
• 2.14 identify as Aboriginal or Torres Strait
• Islanders
• Most common education level partial completion
  of school education followed by a subsequent
  qualification from TAFE / other (44.17)

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Employment Income

• Employment
• Full-time 11
• Part-time 41
• Casual 38
• Not employed (partner working) 11
• Main sources of household income
• Paid employment 43.68
• Government benefits 56.23
• Average family income (after tax) 659.77 p/week

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Motivations to Join Saver Plus

• Opportunity to get matched funds
• Opportunity to get financial literacy training
• Support and counselling
• Learn how to save

• 80.2
• 3.95
• 0.79
• 12.25

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Savings and money management prior to SP
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Past saving and spending behaviour
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Financial products used
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Financial literacy factors
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Levels of success
95 of participants met or exceeded their goals
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Savings goals

• Average saving goal
• Average balance saved
• Monthly balance
• Participants aimed to save the maximum of 1000

• 964
• 1,214
• 125
• 90.1

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Saving behaviour (cont)

• Those who saved more
• Earned more (equivalised weekly income)
• Single income, full-time employment
• Primary income was paid, not govt
• Previous savers

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Patterns of saving behaviour average final
balance
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Enabling factors assisting saving

• Using auto deductions from salary
• Motivated by incentive
• Knowing that education costs were going to be
  covered for the year
• Establishing a steady habit of putting the money
  aside
• Determined attitude to succeed

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Difficulties in saving

• Around 27 had difficulties in saving during the
  program
• Unexpected bills
• Reduced hours of employment
• Major illness

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Financial education

• Approximately 90 were satisfied or very
  satisfied
• Over 80 of participants found the workshops to
  be useful or extremely useful
• (3.95 were motivated to join because of the
  opportunity for financial education)
• Benefits
• Meeting other people, forming networks and social
  connection
• Increased confidence levels
• Practical tips on saving and identifying spending
  leaks
• Distinguishing between needs and wants

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Changes in money management behaviour

• 96 of focus group participants reported an
  increase in their abilities to manage money
  better
• Budgeting
• Use of credit
• Spending leaks
• Choosing products
• Establishing contingency savings fund
• Learning e-banking
• Longer term planning of expenses

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Saving 3 months Post-Saver Plus

• 85 still saving
• 44 same amount
• 20 more
• 34 less
• Most common amount 76 100 per month

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Effects and benefits of the program

• Participants reported
• A greater propensity to plan for the future
• A more positive outlook on life
• A greater level of confidence
• A sense of achievement in reaching a goal
• Increased self-esteem
• A significant reduction in stress levels
• 92 reported a positive experience in the program

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Benefits (contd)

• Top three benefits
• Getting the matched funds 34
• Getting what we saved for 33
• Reduced stress about
• school costs 28
• Evidence of change in perceived benefits from
  when joined i.e. 80 of participants were mainly
  motivated by getting the matched funds when they
  commenced the program

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Other outcomes

• Developing a savings habit
• Gaining confidence in handling finances
• Started their children on savings programs
• Positive effect of the purchase on the childs
  schooling
• Sharing information, establishment of networks
• Established more goals

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Key success factors of pilot

• Holistic approach
• Collaboration between ANZ and Community
  organisations
• Dedication and commitment of staff involved
• Evaluation from beginning, not an afterthought
• The whole is greater than the sum of its parts
• Partnerships
• Financial education component
• Relationship managers
• Incentive (co-contribution arrangements)

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Saver Plus 2006 - 2008

• New Partner Department of Victorian Communities
• Expanded to 18 sites in Vic, NSW, Qld, ACT
• Eligibility criteria includes saving for adult
  vocational education and primary education
• Goal to involve over 5000 participants