Financial Regulators Report Limited Progress in Improving Financial Literacy
WASHINGTON -- NCUA Chairman JoAnn Johnson was among a clutch of federal financial regulators reporting progress toward helping Americans improve their financial literacy while acknowledging to federal legislators that there is much more left to do.
Johnson appeared with the other regulators at an April 15 hearing on federal financial literacy efforts before the House Financial Services Committee, where most legislators appeared pleased that at least some progress was being made but expressed some frustration with its pace.
Chairman Barney Frank (D-Mass.) started the hearing by noting that the topic was very important though "not very sexy" and expressed hope that the current financial situation in much of the country had served to help focus public attention on the subject. Frank added that while a wide spectrum of financial services are available to people without relationships with banks or credit unions, they are almost always a good deal more expensive and can keep their customers living below the poverty line.
Representative Rub?(C)n Hinojosa (D-Texas) was one of the legislators expressing frustration with the pace of the financial literacy progress and how the Financial Literacy Education Commission, which Johnson serves on, had spent money appropriated for its efforts. Hinojosa was one of the legislators who had sponsored the legislation that eventually created the commission.
"I come from the world of business where things just do not take this long and where we learn to look to outcomes to measure, and I am sorry to have to tell you all, the outcomes we are seeing on financial literacy right are really terrible," he said, chastising the panel of regulators.
Johnson drew less of Hinojosa's disapproval, however, as she chairs the commission's subcommittee that overseas the Mymoney.gov Web site, which was generally praised for doing a good job.
Johnson peppered her prepared and oral testimonies with examples of credit unions around the country that are working in wide variety of ways to draw their members into different approaches to financial literacy, many using materials and funding from the agency and many employing their own resources.
Johnson also promoted credit unions' opening of student branches in neighborhood schools as a very direct approach to financial education. She offered the student credit unions in response to a question from Rep. Maxine Waters (D-Calif.) who expressed frustration that much of what passes as financial literacy education was too "theoretical."
"Can any of you tell me of programs where seniors or students are being led through the process of really opening an account," Waters asked. "Anyone?"
Johnson responded that she had been in elementary schools where she had seen students as young as third grade learning the concepts of savings and the value of money from opening credit union accounts in the schools' CU branch.
"These credit union student branches offer the same approach as the credit unions do only with students working with other students, albeit under the supervision and guidance of adults," Johnson said. "That's a very hands on and practical approach," she added.