A single mom.
Photo: Financial Hope Collaborative, Creighton University
Can financial education/coaching break the financial stress, declining health cycle?
In a previous article, I outlined three vicious cycles affecting financial stress, physical and mental health. They are vicious because, once financial stress occurs, the health impacts can lead to yet more stress, which can further impair health, causing additional financial stress as the cycle begins and worsens.
After publishing that story, I learned of the efforts of Creighton University's Financial Success Program to investigate whether financial coaching could break these cycles. The Program provides financial education that seeks to improve the lives of low and moderate income families in Omaha, Nebraska. I interviewed two of the researchers, Julie Kalkowski and Nicole White on July 27.
The Study
In a recent exploratory study, researchers evaluated the link between financial education and health among low-income, single mothers in Omaha. The intervention consisted of nine weekly classes and one year of one-on-one financial coaching. Participants learned about managing monthly cash flow, insurance, predatory lending, the psychology of money, saving for emergencies and setting goals. They also collected receipts and tracked spending.
The investigators measured changes in health and wellbeing one and two years after participating in the program with a pre- and post-surveys.
The study was limited by a small sample size (n=20) and lack of a control group. This means we can’t be sure whether the observed changes in health and welfare were caused by the intervention or might have happened for different reasons. However, the results were tantalizing enough that a larger and more rigorous study is underway. Below, I share some of the key results of the original study and some additional, anecdotal findings, which I learned in the interview.
Financial Impact
The program did appear to improve participants’ finances. Mean annual income increased $8,026 (+29%) and credit scores increased as well. Participants reported fewer utility shut-off notices and overdrafts (see chart below). It’s notable that participants required less assistance from community agencies, suggesting broader societal benefits to financial education and coaching.
Financial Education and coaching materially improved the financial condition of single mothers in… [+] the study. Used with permission from Packard KA, Kalkowski JC, White ND, Ryan-Haddad AM, Black LL, Flecky KA, Furze JA, Rusch LM, Qi Y. Effect of a financial education program on the health of single, low-income women and their children. International Public Health Journal. 2015;7(1):37-54.
Used with permission from: Packard KA, Kalkowski JC, White ND, Ryan-Haddad AM, Black LL, Flecky KA, Furze JA, Rusch LM, Qi Y. Effect of a financial education program on the health of single, low-income women and their children. International Public Health Journal. 2015;7(1):37-54.
Did Financial Education & Coaching Improve Health (Vicious Cycle 1)?
Vicious Cycle #1: Financial stress associated with high risk behaviors and poor health,
