Budget Basics Online Creates Money Management Skills

Consumers today are faced with a wider and increasingly complicated array of options for arranging their personal finances and selecting investments and credit products. Technological advances have increased the capacity for targeted marketing to consumers, potentially increasing some consumers' vulnerability to predatory lenders and other unscrupulous providers of financial services. Household debt as a percentage of income hovers at record high levels. In addition, bankruptcy rates have more than quadrupled in the past 20 years.

Often people are more willing to participate in financial education programs when in crisis, when acquiring a major asset, or simply when participation is convenient. However, many consumers will not participate in financial education in large group settings if the language or setting suggests they have a problem. When people are struggling with their finances, they are less likely to seek help if someone they know might "see" them seeking help. People often would rather travel two counties away for financial education than participate in their own community.

Extension's Response...

ISU Extension offers Budget Basics as a monthly online course. The three-hour program is offered in one-hour-per-week sessions for three weeks. Participants attend at a time that is convenient for them, choosing between noon or 5 p.m. sessions. The sessions also are recorded for repeat viewing and so participants can "catch up" if they miss the original session.

Participants log into the Web-based classroom using their first name. Only the instructor knows who has preregistered for the class. Participants may share their feelings and concerns through a chat box without revealing their identity.

The first session covers developing a spending plan, setting goals, and planning for irregular expenses and for retirement. Session two covers ways to track expenses, save money, and increase income. During the third session, participants learn about shopping for insurance, managing credit, and finding additional consumer resources for managing finances. ISU Extension regularly reviews and updates Budget Basics to keep it relevant for participants.

Results

Fifty-four participants from 24 counties across the state have participated in this online budgeting course since it began in August 2009. Participants ranked highest in importance the ability to participate anonymously. They also enjoyed the interactive nature of the online classes and appreciated the convenience and the ability to watch recorded sessions. The topics addressing credit generated the most questions and discussion among participants.

Participant comments include the following:

  • "I have two children, a husband, and work six days a week. The recorded sessions were very nice. I could [watch the session] in the middle of the night."
  • "The whole course offered information relating to my everyday life."
  • "I plan to start an emergency fund, check my credit history, and use the periodical spending calendar and have an account set up for those funds."
  • "I have become more aware of my spending by writing it all down, and I will be spending less because of this course (needs vs. wants and eating out)."

Various agencies and banks are requiring some of their clients to take a budgeting course. Participants can earn a certificate for completing Budget Basics by answering a series of questions in which they apply the concepts they were taught to their own finances.

Contact

Pat Swanson, Family Resource Management State Specialist, 515-294-2731

Acknowledgements

Brenda Schmitt, Family Finance Program Specialist
 

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