Financial literacy and over-indebtedness in low-income households

Financial literacy can explain a significant proportion of wealth inequality. Among the key components of financial literacy are numeracy and money management skills. Our study examines the relative importance of these components in the determination of consumer debt and household net worth among credit union members in socially disadvantaged areas. The main finding from our analysis is that money management skills are important determinants of financial outcomes but that numeracy has almost no role to play. This result adds to a recent US-based behavioural finance literature on the role of attention and planning in consumer finance. Findings are found to be robust when the sample is reduced to only those who have a clear role in household financial decision-making and also when controlling for potential endogeneity. Our findings have policy implications in the UK and elsewhere as credit unions across the world are important players in national financial literacy strategies.

Assistive software tools for secondary-level students with literacy difficulties.

Study conducted to evaluate the effectiveness of four assistive technology (AT) tools on literacy: (1) speech synthesis, (2) spellchecker, (3) homophone tool, and (4) dictionary. All four of these programs are featured in TextHelp’s Read&Write Gold software package. A total of 93 secondary-level students with reading disabilities participated in the study. The participants completed a number of computer-based literacy tests after being assigned to a Read&Write group or a control group that utilized Microsoft Word. The results indicated that improvements in the following areas for the Read&Write group: (1) reading comprehension, (2) homophone error detection, (3) spelling error detection, and (4) word meanings. The Microsoft Word group also improved in the areas of word meanings and error detection, though performed worse on homophone error detection. The authors contend that these results indicate that speech synthesis, spell checkers, homophone tools, and dictionary programs have a positive effect on literacy among students with reading disabilities. This study was conducted by researchers at the Queen’s University in Belfast, Ireland.