Money Comms Lab - communicating about money and the financial system by Meteos

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introduction The UK public is living with the fallout of the deepest financial crisis for decades. New policies, regulations and reforms to address problems within the sector and to reboot the economy are taking root. They include the investigation and redress of wrongdoing, and the use of radical methods, such as quantitative easing, the effectiveness and impact of which are not yet fully understood. Despite these measures, levels of trust in the financial sector are low and most people in the UK believe that more regulation is needed.1 This is partly because of the ongoing revelations about scandals, including Libor fixing, PPI mis-selling and the manipulation of foreign exchange markets, some of which happened after the bank bailouts in 2008. It is also because – in large part as a result of the crisis – large numbers of people are facing serious economic hardship. Economic inequality in the UK is the worst in Europe.2 Many UK households are struggling to manage their finances due to low wage growth,3 insecure jobs,4 government welfare reform,5 increasing levels of personal debt,6 falling pension annuity rates7 and the rising cost of housing.8 Nor do they have support to manage this situation; recent reports indicate a lack of capability or advice to help people in financial distress.9 At the same time, our monetary and financial systems are transforming – much faster than most people understand – enabled by new technology and innovation, the regulation and reform agenda, and changing expectations and attitudes.10 This is changing, amongst other things, who holds the power over money and the financial system (e.g. will banks be disintermediated by the growing number of peer-to-peer lending platforms?), who they serve and how (e.g. will banking take place online instead of in local branches?) and where risks lie (e.g. who will bear the cost of future bank failures – if not the tax payer, as the government has said?). These questions about control over and the social usefulness of the financial system today, and how it will evolve in future, are vital to people’s lives. It is, therefore, striking and worrying how little societal engagement there has been with these issues. Without a strong and informed societal voice, the public is unable to counterbalance the power of better-represented stakeholders of the system and to hold them to account. A weak societal voice means that the public’s views on the purpose and future of the financial system are not influencing how these challenges are resolved. Regulators and policy makers cannot know if they are responding to societal needs, and financial institutions cannot be monitored for their societal purpose and impact. The result is a flawed system, with weak channels of accountability. The Money Comms Lab was set up by Meteos to find out why public engagement with money and the financial system is so low, and to contribute to the effort to find solutions. This report of its findings was written by Marloes Nicholls, with support from Sarah Cassidy, Cassie Tickell-Painter and Sophia Tickell.

meteos project team Meteos is a not-for-profit company that undertakes research-based,

multi-stakeholder dialogues. Our dialogues, focused on finance, health and the environment, provide a forum for senior figures in the corporate sector, civil society, public sector and investment worlds to share different perspectives on the major trends that will shape market, regulatory and societal outcomes in coming years.

Sarah Cassidy

Facilitator Project Manager

Money Comms Lab Meteos

Marloes Nicholls

Director Programme Manager & Researcher

Money Comms Lab Meteos

Sophia Tickell

Advisor Co-Founder & Partner

Money Comms Lab Meteos

Cassie Tickell-Painter

Researcher

Money Comms Lab Meteos

money comms lab participants Callum Anderson Campaigns & Policy Assistant

Community Investment Coalition (until September 2015)

Leander Bindewald Researcher

Institute for Leadership and Sustainability, University of Cumbria

Matthew Blakstad

Head of Member Proposition

National Employment Saving Trust

Fran Boait

Executive Director

Positive Money

Bruce Davis**

Managing Director

Abundance Generation

Dr Mark Davis

Founder & Associate Professor of Sociology

The Bauman Institute, University of Leeds

Nigel Dodd**

Professor of Sociology

London School of Economics

Will Ferguson

Communications Officer

Triodos UK

Keelia Fitzpatrick

Project Officer

ShareAction

Greg Ford

Senior Communications Advisor

Finance Watch

Damon Gibbons

Director

Centre for Responsible Credit

Niamh Goggin

Director

Small Change Ltd

Jamie Hartzell

Chair

Ethex

Catherine Joyce

Senior Campaigns Officer; Digital Coordinator

Macmillan (until September 2015); The Children’s Society

Michael Kumhof

Senior Research Advisor

Bank of England

Anna Laycock

Lead Strategist

The Finance Innovation Lab

Joel Lazarus**

Research Fellow

Warwick University

Duncan McCann

Researcher, Economy and Finance

New Economics Foundation

Dora Meade**

Community Organiser

Positive Money

Alison Pask**

Vice Principal & Head of Faculty, Financial Capability

Institute of Financial Services School of Finance

Ib Ravn Associate Professor

Department of Education, Aarhus University

Andrew Robinson* Director of Market Development

Churches, Charities and Local Authorities

Linda Ryan

Marketing and Communications Adviser Global Alliance for Banking on Values

Bec Sanderson

Researcher

Public Interest Research Centre

Tom Shakhli

Engagement Manager

The Brixton Pound

Tanya Spence

Financial Health Training & Resource Development Manager

Toynbee Hall

Dan Stanley

Co-founder & Managing Director

Small Axe

Geoff Tily

Senior Economist

Trade Union Congress

Danielle Walker Palmour** Director

Friends Provident Foundation

Fionn Travers-Smith*

Move Your Money UK

Campaign Manager

The Shared Challenge Money Comms Lab was a collaborative research project convened and led by Meteos. It was unique in bringing together a group of people at the forefront of communicating with the public on matters relating to money and the financial system in order to create positive change. The group was also unique in that the participants derive their communications expertise and experience from across a variety of sectors. They work in academia and research, civil society, education, marketing, and innovation and product provision. Issues that they work on cover broad ground, including improving customer experience and trust in financial services, financial inclusion and microfinance, protection of financial service users, positive and long-term investment, financial and monetary reform, and community currencies. The changes participants aim to achieve through their work lie across a spectrum. At one end, the aim is to improve people’s experience of the financial system. This may be to help people make better decisions, to help people hold the current system to account, and to help them think about finance in a way that improves their wellbeing. Towards the other end of the spectrum, the aim is to transform the system by calling on consumers, citizens and policy makers to use their power to change the rules and norms that shape the financial and monetary systems, and – by influencing attitudes and beliefs – to transform the role of money in people’s lives. The change participants aspire to can also be seen as working from short- to long-term time horizons.

“We change what we think and do on the basis of new information that we absorb, consciously or not. This can be a logical or emotional process, but it’s always a process based on communication – verbal, textual or visual. The way that people relate to and think about money and the financial system will take time to change, but it will only change with a concerted communications effort from those who recognise the power of money and finance to shape lives – now and in future.”

Finally, the methods of communication in which the participants have experience and expertise are a mixed bag: some work with networks of organisations, others directly with service users; some work from the grassroots up, and others from the top down; some facilitate conversations, and others speak publically as thought leaders; some work online with social media, and others work directly with people. None of these are mutually exclusive. Despite these widely varied aims and approaches, this diverse group saw value in coming together to share their communication questions and insights. There are three important reasons why. The first is their passion for improving the role and impact of money and the financial system in people’s lives. In this effort, participants are all motivated to significantly improve the UK public’s understanding, engagement and empowerment regarding money and the financial system.

*These participants attended the workshop but were unable to complete an interview. **These participants were interviewed but unable to attend the workshop. Unattributed quotes throughout this report are from interviews with Money Comms Lab participants.

Second, the participants see communication as an essential tool with which to build understanding, engagement and empowerment. With the right communication, they believe, people will be more receptive to new information and ideas, and more likely to shift their attitudes, motivations, values and behaviours. Technology and innovation are changing the way people experience, relate to, and think about money and finance, and the participants were keen to learn from one another how they might update and adapt their approach to communication. For example, the general public has become familiar with the “digitisation” of money and finance. “Cashless” is here, smartphone apps can be used to make payments, and hundreds of digital currencies have arisen in the last few years. Some experts think that technology may help a younger generation to be less intimidated by finance and improve engagement with financial services. Others emphasise that an increasingly digital relationship with money and finance makes it more and more ethereal, and therefore harder to connect to. Third, and finally, the group saw value in coming together to work on communication because the low level of public engagement with money and finance means that, to a certain extent, participants share the same starting point in rising to the challenge of capturing the public’s attention, despite the different messages they may ultimately want to impart.

Money versus Finance Some participants see an important distinction between the ways that people relate to money versus how they relate to the financial system, with implications for the best way to communicate about each. Money is something that people use every day and, to that extent, is something that most people feel able to comprehend. Despite this, very few people understand how money is created, how the monetary system functions, or that different critiques exist about how money functions in our society. It is often unquestioned and seen as an inevitable part of everyday life – like gravity. It is harder for people to relate to the financial system (broadly, the system of financial markets, institutions and individuals). It is perceived as complex, abstract and intangible. Despite this, most people have an opinion (whether informed or not) on some aspects of the financial system – for example they might refer to “casino finance”, “fat cats” and mis-selling scandals, or at least know that there are opinions to be held.

with their diverse perspectives, to share their experience and expertise in communicating about money and the financial system. It aimed to create an opportunity to discuss and reflect on the key barriers to communicating about these issues, the root causes of these barriers, and how to overcome them. It also allowed participants to begin to pool lessons and generate new ideas for effective communication.

This Document Since the project’s inception, Money Comms Lab intended to make its findings publically available and to generate a shared resource that could be used and developed by others working to communicate about money and the financial system. Therefore, this document captures the key discussions and conclusions of Money Comms Lab to date. Whilst it aims to relay the collective view of the group, there was a rich diversity of opinions and experiences; hence this document reflects the efforts of the Meteos team as convenors of Money Comms Lab to synthesise those views. The document first lays out the analysis of the communication challenge that participants built through Money Comms Lab. This includes an outline of its root causes and how these manifest as barriers to effective communication. It then presents the lessons participants have learned in order to overcome these communication barriers. Finally, the report concludes with three ideas about what needs to happen to develop and improve communications on money and the financial system.

As well as improving their own communications, Lab participants also identified a need for policy changes. They pointed to ways, for instance, that financial literacy education could be better designed and delivered, communication by financial services better regulated, and independent advice and information to those in financial difficulty better provided. Whilst important, this went beyond the scope of Money Comms Lab.

The Money Comms Lab Process The scope and direction of Money Comms Lab was shaped by its participants, whose communications and engagement work the project aimed to inform and support. The participants were initially asked to complete a questionnaire or interview, which helped to identify the nature of the communication challenge. Their responses, as well as desktop research, formed the basis for the workshop that Meteos held in July 2015. The workshop was designed to help participants,

The roots of the problem The challenge of communicating about money and the financial system is deeply rooted in human psychology, the power imbalance between the financial sector and the public, as well as a number of political, social and cultural issues.

Individual level The psychology of communications is complex. People absorb and process information, and behave and make decisions in ways that are still not fully understood. Having access to information is not enough to ensure that people will absorb it – or at least, not in the way that was intended. Attitudes, motivations and values all affect how people receive, hear and act on what is communicated.11 Sometimes emotions take control. And when information is incomplete or not fully understood, people may make erroneous connections and conclusions. Behavioural finance and economics have found systematic ways in which people deviate from “rational” behaviour when making decisions. For example, too much complexity and choice – two increasingly common features of finance – have been shown to create a psychological burden that leads to less-good decisions.12 Faced with limited time as well as numerous other decisions to make, people can experience “cognitive overload” when offered additional choices and information about their finances. Unless the decision can be delegated to someone else, such as an advisor, family member or friend, people often default to inertia – and no decision is made. A significant amount of work has been undertaken recently to apply the findings of behavioural economics to how people manage their personal finances. For example, the Financial Conduct Authority, the Money Advice Service and many financial service providers have begun to explore what this means for the way they regulate, provide advice and design financial products and services.13 There is also a burgeoning field of “financial therapy”14 that integrates traditional financial advice with new understanding about the way people emotionally relate to money and finance.

Sector level As with many professions, a power imbalance exists between finance professionals and their customers. In many fields, professionals have access to more information than their customers about the products and services they provide. Furthermore, they may be incentivised to exploit this “information asymmetry” in order to make more profit or meet targets. They can do this by failing to impart knowledge or through obfuscation. Finance certainly is full of jargon and the concepts used, as well as the products and services offered, can be highly complex. Research shows that finance professionals’ thought processes and behaviour are likely to be governed by a complexity bias too.15 Overall, information provided to customers is often hard to use and confusing, and can contribute to misunderstanding.

In addition, there are norms that often go unquestioned around what we should be seeking from the financial sector. For example, “best buy” tables persistently tell people that the only thing to care about with regard to a financial product is the rate of return, rather than other considerations such as long-term value. These messages do not offer a holistic view of consumer options and choices.

“People are perfectly capable

A further challenge to communicating about finance is the powerful influence of the financial lobby over politicians, the media and the general public, in part due to the resources at its disposal. In 2014, Corporate Watch estimated that €123m was spent by the finance industry lobby on influencing EU financial policy, more than 30 times what was spent by civil society.16

principles and without using

Some Lab participants noted that the prism through which we understand the financial system is reinforced and normalised by the physical environment too – through the prevalence of financial advertising and iconic infrastructure, such as cashpoints and imposing buildings.

adopted by politicians,

of understanding how the financial system operates and how this is impacting their lives if it is explained from first the deliberately opaque language that has been created by the financial services industry – and has subsequently been regulators and the media.”

Restricted channels of communication between the financial sector and the public, participants argued, serve to further entrench this power imbalance. For instance, financial institutions are generally not well designed to enable people to engage with them and so communication is often “one way”. If someone wants to speak with and ask questions of, for example, their bank or pension fund it can be very difficult and time-consuming. Regulation, intended to protect the public interest, can contribute to the problem. For example, requirements of firms to provide customers with standard, approved responses can limit the quality of engagement banks can have with their customers. Some participants expressed concern that the rise of digital communications will make it even more difficult for customers to ask questions or raise concerns, because it will lead to a further reduction in face-to-face contact. Finally, participants agreed that the vast amount of intermediation within the finance sector, whereby a growing number of “middlemen” lie between people and their money, contributes to the disconnection people feel towards their money and finances.

“When it comes to financial

Societal level

products, people can be very

People’s complex psychological responses to money and finance have combined with the scale and reach of the financial sector, as well as vested interests, to create a dominant narrative about money and the financial system. Some Lab participants described this narrative as neoliberal, “profinancialisation”, and one in which money is seen as neutral and purely functional. Participants cited a number of ideas propagated by this narrative, such as “hard work pays”, “debt must be managed and paid off”, “welfare spending is irresponsible”, “taxpayers deserve more” and “tax itself is an unfair burden”. This adds to the stigma around poverty and financial difficulty. It tends to place the responsibility for financial hardship on those most affected, and reduces the responsibility of other factors and players. The narrative is powerful and it creates, reinforces – and is itself reinforced by – deep-rooted social structures and norms.

financially focused, in a way that they wouldn’t be if they were looking at any other product. You wouldn’t buy a sandwich based on cost alone, but people seem happy to pay on that basis when it comes

“There’s a feeling that you’ll be judged to have failed or to be incompetent

to finance.”

if you have money troubles.”

Participants argued that the narrative is supported by the media and the education system. Many journalists and teachers have limited understanding of money and finance. The media is often poor at explaining important, complex issues. Financial education is sporadic, and too frequently given by teachers who themselves feel under-confident. The result is that instead of enlightening people, it can actually engender fear. Participants also argued that there is a culture of inappropriate deference to experts, whose expertise they questioned. They argued that economists, in particular, could take more responsibility for improving understanding. More broadly, participants argued that a lack of political engagement, as well as the idea that people are first and foremost financial consumers rather than financial citizens and learners, limits people’s sense of agency and responsibility. Finally, many of the Lab participants thought that the independent organisations working to communicate about money and the financial system are not adequately resourced to do so. This is predominantly because: l

“There’s a myth that people without money are wasteful. Actually it’s the wealthy who have been shown to be the ones to make random spending decisions.” “Whenever quantitative

Attitudes, motivations and values

explained in the press it

Attitudes, motivations and values – of individuals, groups and society – all affect how people hear and absorb what is communicated. In turn, this determines whether and how they engage.

is explained as magic. It’s ridiculous that something that isn’t actually that complex is described in Harry Potter language,

There is a drive for “quick wins” from campaigns, but one-off events are too superficial and short-term to engage people with money and the financial system.

it. It’s wrong to describe it

of a shared vision and language across organisations, as well as competition (rather than collaboration) between them, hinder an alternative, unified communication effort.

“The mis-teaching of how banking and money

The communication challenge manifests as a range of barriers that the Lab participants face when trying to communicate about money and the financial system. Despite the participants’ diverse communications purposes – from improving people’s experience within the current financial system, to transforming the system – the barriers described below are common.

easing, for example, gets

Resources and skills within civil society are not well-suited to addressing the communication challenge, and it is hard to secure funding specifically to develop communications expertise.

l A lack

Barriers to communication

and conveys to people that they are too thick to get in this way; it perpetuates ignorance.”

In the UK, for example, there are social attitudes that can make it difficult to speak with people about money. Some people consider it taboo or vulgar because it is thought to be private. Speaking about one’s wealth is something people find particularly uncomfortable. Money and finance have also been found to invoke particular preferences and values in people that affect the way they engage with others. For example, one study found that in a group setting, the physical presence and visibility of money leads people to be more likely to work alone to complete a task. The researchers believe this indicates that money provokes a preference to be free of dependency and dependants.17

Emotion and stress Although it is not openly acknowledged, money is a deeply emotional topic for most people. Money plays an important role in many key moments in people’s lives, which leads them to associate money with the powerful emotions of those moments. These emotional associations appear to form particularly strongly in childhood. Finance can also induce worry and stress. Despite the ability some people have to block out financial troubles, people are more likely to be aware of their finances when they are in crisis.

work in economics textbooks has been well

Guilt and shame

documented. It is also hard to change this when

It is also common for people to carry feelings of guilt and shame with regard to their finances, particularly in relation to debt. Wealthy people can feel embarrassed about their fortune.18

the misconceptions have been reinforced by central bankers, politicians and other credible figures for so long.”

Insecurity and fear People are fearful and insecure about finance (and their personal finances) because of its inherently risky nature. People generally hold a psychological bias (called “loss aversion”19) which makes them more concerned with what they may lose than what they might gain. This is not just a perception. For many British households, economic insecurity is rising. Despite official reports of a recovering economy and increasing employment, research by StepChange Debt Charity finds that income insecurity and shocks have become the “new normal” for many people and that this is a growing problem.20 The Bank of England has warned of the growing reliance on personal

loans and the vulnerability of indebted households.21 It is hard to encourage people to make changes in a situation they feel insecure about because they will be anxious about taking on new risks and therefore potentially facing further losses.

Recent research found that in the UK: l

Lack of understanding Understanding of money and the financial system is low amongst most of the general public, and there is pervasive ignorance at all levels: in basic skills (numeracy, literacy, digital literacy, communication and problem solving); financial knowledge regarding personal finances; and how the wider financial system works.22 The poor level of mathematical and financial education in the UK helps to explain some of this lack of understanding. However, some people – even experts and professionals in finance – exhibit an unwillingness to have pre-existing views challenged and to take on board new information. This, some participants have found, can come across as arrogance and narrowmindedness, but they think that it can be explained by a fear of appearing ignorant and the protection of vested interests.

Knowing “too much of the wrong thing” Alongside a lack of understanding, most people know “too much of the wrong thing”. People draw on their personal experience of using money and finance in their day-to-day lives and the “dominant public narrative” to understand the wider financial system. This may lead to erroneous conclusions about the causes of financial difficulties. For example, many people’s understanding of national debt is shaped by their understanding of personal debt, despite there being important differences between the two.

Perceived irrelevance People are occupied with many concerns, but not usually by grand questions such as “What is money?” These kinds of questions are, understandably, considered irrelevant by people if they cannot join the dots between them and the numerous challenges they face in their everyday lives.

16 percent of adults are unable to identify the balance on a bank statement 23 42 percent of young people could not tell the difference between being overdrawn or in credit 24 37 percent of young people are unsure of what a bank is 25 One in 10 MPs know how money is created 26

Trust deficit The level of trust in the financial system amongst the public is low.27 This can make it difficult even for those with the public interest at heart to be trusted, credible messengers about issues relating to money and finance. The picture is nuanced though,28 as people tend to trust the parts of the system they directly interact with, such as their local bank branch or the cashpoint and payment services they use. With regards to financial advice, people generally do not know who to trust.

Disempowerment

“Everyone knows the stories about the stork and Santa and the gold in the vaults of the Bank of England. They’re all creation myths. Of course, sex is the origin of people, mum and dad buy presents, and money is created by private banks.” “The key challenge is to find

Despite the importance of money and the financial system in people’s lives, most people do not feel able to participate in discussions relating to these issues or to influence change; many do not even consider that to be an option. Even when people know that they can and need to engage in some way – for example, by making a formal complaint to a financial institution – they often require great encouragement and support.

ways to translate the awareness

“Whether we like it or not, economics

the financial system as a whole

“In a sense, people know too much.

impacts on every aspect of our lives,

contributes to broader social

They grew up with money – like

from the price of a pint to the amount

problems – like inequality.”

pocket money and the money in

of rent we pay each month. People are

story books – and assume they

aware of this. Yet they feel they lack

“When I start working with a

know what money is and how it

the language to talk about it or the

community they’ll often say

works. These perceptions are

knowledge to understand it, or the

that the issues they’re most

so engrained in people’s minds

ability to challenge it.”

concerned about are things like

“In order to protect our egos we tend not to think about or want information about things we don’t understand.”

people have about, for example, the poor customer service they might receive or a bank scandal they’ve read about into a thorough understanding of how

it’s difficult to take them out

dog dirt, anti-social behaviour

of this way of thinking.”

and finding something for the kids to do. Financial issues are never at the top. It’s just not something people talk about – even when we know there are huge problems with debt in the community.”

Lessons and Ideas for Effective Communication

Lessons and ideas for overcoming barriers to communicating about money and finance Working with attitudes, motivations and values l

Reinforcing vs. challenging attitudes, values and motivations Lab participants have found that tailoring messages to fit with the audience’s existing attitudes, values and motivations in relation to money and finance can often reinforce those that are not helpful in achieving the change they seek. For example, fear and threat tactics can be effective in terms of drawing attention to an issue, but may be counterproductive in terms of prompting action. Lab participants had different views about how best to respond to this. Some think it is most important that communications should reflect and encourage the values they want people to associate with the monetary and financial system.29 Others consider this to be idealistic and think that the primary aim should be to make a message stand out. In the middle, others think that a trade-off can be made between the two.

Appealing to the most helpful set of attitudes, values and motivations People can hold different attitudes, values and motivations, depending on which part of their identity is appealed to. For example, an economist can be spoken to as a professional (e.g. in the language of economic models and numbers) or as a family member. Lab participants described how they try to pick the most helpful set of attitudes to appeal to, given the response they would like to generate.

Understanding and challenging associations It is important to understand the associations the audience holds in relation to an issue. For example, Lab participants working on community currencies have found that their work is often associated with issues that are perceived to be minority concerns or “alternative” views (e.g. veganism), about which the audience can have negative views. These connotations may need to be challenged if they are untrue or unhelpful.

Collectively, the Money Comms Lab participants have an abundance of learning and ideas about how to overcome the communication barriers they share. These come from their experience of working with and targeting multiple audiences, including the general public, policy makers and regulators, government, public sector employees, trade unions, employers, industry professionals, bodies and institutions, advice agencies, teachers and academics. The following lessons are divided into two parts. First are general pointers for effective communication; second, lessons that relate to specific barriers to communication about money and finance.

General pointers for effective communication l

Clarity of purpose Communication will only succeed if its purpose and aims are clear. Knowing the audience Given the communication objectives, a target audience can be identified. And once selected, they need to be understood. Questions that Lab participants always ask of a target audience are: u What are your attitudes, values and motivations? u What are your needs and interests?

Lab participants emphasised that it pays to draw on research to test assumptions about the beliefs of a target group. Some have found that focus groups can be more effective than methods that involve direct questions, e.g. polling, because they allow for a conversation to take place which can draw out richer insights. l

Tailoring Insights and understanding of an audience should be used to tailor communication with them. This helps Lab participants to overcome the discrepancies between what they want people to know and what people will actually respond to. When designing communication for a target group, three useful questions to ask are: u What messages will resonate with them?

Being sensitive to emotions, stress, guilt and shame l

Offering safe space Providing space and time for people to build relationships and feel safe is crucial to help them feel comfortable sharing their financial troubles.

Sharing struggles Bringing together people with similar financial struggles to share their problems can help them to overcome guilt and shame.

Challenging insecurity and fear with confidence and hope l

Emphasising the opportunity The fear of loss that people have about their finances needs to be mitigated by highlighting the gains to be made by engaging with the issues.

Highlighting precedent Examples of relevant historical events can help people to feel more comfortable, and confident that positive change can happen.

u What are the most appropriate and effective media through which to reach them? u Which messengers are they most likely to listen to and trust?

Keeping it simple and helping people to be receptive l

Keeping it simple Communication needs to be appropriately pitched to the audience’s level of understanding. Given the generally low level of financial literacy and public understanding of the financial system, communication should be kept as simple as possible. However, Lab participants warned that communication should avoid being patronising or misleading, which can exacerbate the problems of low understanding and trust.

Mixing media

A range of media can be used to help explain aspects of money or finance, including images, videos and podcasts. Lab participants recommended using a mix of media as different people absorb information in different ways. l

Building community

and finance relate to the personal level, which is easier for people to relate to and engage with, and can help people to think critically about the role that their day-to-day decisions and behaviours play with regards to these wider social issues. l

Providing a quick and easy way to engage Once a problem is clearly defined and understood, it is important to help the audience see that there is a solution – and that there is something that they can do – in a way that is easy, straightforward, and explained step by step. For example, policy makers, particularly in government, tend to have a huge variety of issues that they are responsible for. Therefore, Lab participants advise, it needs to be made as easy as possible for them to take up the cause, for example, by providing them with credible research or suggesting the wording of bills and speeches.

Being timely Research has found that, with regards to personal finance, people find it difficult to access and retrieve information at times of need.31, 32 Therefore, it is likely to be fruitful to think carefully about what information an audience requires at a particular point in time, and how that can be made most accessible when they need it.

An audience can be encouraged to stay engaged over time and to invest time in learning new things through being a member of a community (in person or online). l

Supporting change in minds

Some Lab participants warned of “crusading”. People, they said, are more likely to be convinced to engage with an issue if they are helped to come to their own conclusions about it. Other Lab participants have found that some people in particular will need support to not feel defensive, embarrassed, overwhelmed or like they might be punished for taking on board new ideas and information. For an audience that already has a strong sense of “the truth” it can help to nurture spaces where disagreement and debate is possible and valued, and in which people feel comfortable asking questions. It can also help to find particular people within the target audience who are more open than others to new ideas. For example, Lab participants have found that academics with greater job security and stronger reputations tend to be more receptive and open to challenge.

Building trust l

Collaborating with trusted messengers In order for a message to be delivered by the most credible or trusted voices for the audience, collaboration and partnership may be required. Some ideas for trusted messengers on money and finance include: an employer, personal finance columnists, and thought leaders such as the Archbishop of Canterbury, Justin Welby.

Persisting Improving the roles of money and finance in people’s lives are long-term challenges and require long-term investment to build new, trusted relationships.

Layering communication “Dual communications” can help build communication that is both eye-catching and trustworthy: a top-level communication can be designed to grab people’s attention and guide people to a secondary tier of information that provides more detailed, credible content.

Making it relevant, important and accessible l

Starting with what people think they know Communications should be developed from what the audience thinks they know about an issue, e.g. an intuition that “taking on more and more debt is a problem”. If this is incomplete, their knowledge should be built from there. Or, if their understanding is wrong, then it needs to be challenged. Rooting issues in everyday concerns and needs It is important to focus on what the issue actually means for the audience in relation to their dayto-day needs and concerns, as opposed to discussing the issue in the abstract. If an MP is the target, for example, the message needs to be made relevant to his or her constituents. Unpacking language can help to make issues more relevant too. For example, people will find it easier to understand and respond to “a rising number of families have so little money that they cannot eat unless they go to a food bank” than to “rising inequality”.30 Tapping into underlying interest The level of interest in money and the financial system across society should not be underestimated. The trick is to find out how to tap into it. Some Lab participants said that the key is to find a way to give people the space and time to have a conversation about the issues. Some have found that there are particular topics and questions that people are really interested in, that can be used as a hook or entry point from which to speak about other issues relating to money and the financial system. For example, savers and investors are often interested in knowing what their money is doing, and students show interest in innovations such as Bitcoin. Raising awareness of the debate Most people are unaware of many of the problems with money and finance, or that the ways they currently work are not inevitable. Therefore, they need help to understand that there are spaces for innovation and experimentation. Lab participants have found that community currencies can be powerful experiential learning tools to help people open their minds to thinking about money in a different way. Historical examples can also help people to understand how money and finance have already changed so much over time. Using stories Stories can help to make problems with money and finance, and their solutions, as tangible and relevant as possible. They can also help to illustrate how the systemic, macro issues with money

Being empowering l

Encouraging conversation Lab participants have found that people are unlikely to raise their financial problems themselves, so need to be encouraged to do so.

Building confidence Helping the audience understand how much they already know about money and the financial system from their day-to-day experiences can help to build their confidence. Unusual approaches (such as art trips or design competitions) that people might feel more confident about engaging with than money and finance can also help to draw people in.

Being open Treating communication as a long-term and two-way process in which everyone is giving (communicating) and receiving (listening) can help to provide space for the audience to speak, ask questions and raise issues.

Providing adequate support The experience of the Lab participants is that it can be easy to underestimate the support an audience needs to engage with an issue. Don’t underestimate the level of disempowerment people feel in relation to money and finance.

conclusion

references 1. Edelman Trust Barometer, 2015. 2. Recent developments in the distribution of wages in Europe, Eurofound, 2015. 3. UK unemployment falls but wage growth weakens, The Guardian, 20 January 2016.

Money Comms Lab provided a unique and useful space to think about how to communicate more effectively about money and the financial system. It resulted in a fascinating and illuminating analysis of the problem, namely the barriers to communication and their root causes. It also enabled the participants to share and pool their lessons and ideas for effective communication. It is hoped that these insights will be useful to those working in the public interest and trying to communicate about money and finance. It is also hoped that more work will be undertaken to build on the Lab’s findings. Although a wealth of ideas for effective communication were generated and pooled, there are notable gaps in understanding. For example, some of the lessons and ideas are more specific than others, some are more or less theory-based, and there is a notable lack of evaluation of interventions or empirical evidence. Furthermore, in order for the participants, their organisations and their peers to be able to develop and improve their communications even further in future, Lab participants identified three essential needs: l

A new narrative Money Comms Lab participants agreed that the existing powerful and dominant narrative shapes and influences everyone’s responses to new ideas about money and the financial system, and is undermining the potential for public engagement these issues. It therefore needs to be challenged by building a new, shared narrative that supports and reinforces different values and messages. Coordination and collaboration Participants saw value in working together more.This would allow them to coordinate the use of different messages and approaches required to effectively influence different parts of the financial system in ways that complement, amplify and leverage each other’s work. Evidence There is a need for more evidence to inform the design of communications.This is particularly true for the new, broader audience that participants are trying to reach. So far, participants have tended to reach people already interested in the issues. In particular, more evidence is needed about what motivates people and what values they hold in relation to money and the financial system, and which messengers they trust.

4. Navigating the New Normal: Why working families fall into problem debt and how we need to respond, StepChange Debt Charity, 2015 5. UK Government welfare reform. 6. Consumer spending rise troubles Bank of England, The Guardian, 24 November 2015. 7. Another poor year for annuity rates; www.moneyfacts.co.uk; 11 January 2016 (site last visited 22 March 2016). 8. Annual Housing Market Forecast, Royal Institute of Chartered Surveyors, 2015. 9. Financial Capability Outcome Frameworks, New Philanthropy Capital, Kail, A. et al, 2014; 10. The Millennial Disruption Index, 2013; Ernst and Young Global Consumer Banking Survey: Winning Through Customer Experience, 2014. 11. The Financial Capability of the UK, Money Advice Service, 2013; Financial Capability Outcome Frameworks, New Philanthropy Capital, Kail, A. et al, 2014. 12. Applying behavioural economics at the Financial Conduct Authority, Financial Conduct Authority, Occasional Paper 1, Kristine Erta et all, 2013. 13. Examples include: White Paper on Behavioural Finance, Barclays; Applying behavioural economics at the Financial Conduct Authority, Financial Conduct Authority, Occasional Paper 1, Kristine Erta et all, 2013; Money Lives: The financial behaviour of the UK, Money Advice Service, 2014. 14. For example, see the work of the Financial Therapy Association. 15. Inside the Banker’s Brain: Mental Models in the Financial Services Industry and Implications for Consumers, Practitioners and Regulators, Ochs, S., 2014 16. The Fire Power of the Financial Lobby: A Survey of the Size of the Financial Lobby at the EU Level, Corporate Europe Observatory, 2014. 17. The Psychological Consequences of Money, Vohs, K. et al, Science 314, 1154, 2006. 18. Guilt Money: The Guilt of Inherited Wealth, Zehnder, A., Ascent Private Capital Management, 2013. 19. Choices, Values and Frames, Kahneman, D. and Tversky, A, American Psychologist 39 (4): 341 – 350, 1984. 20. Navigating the New Normal: Why working families fall into problem debt and how we need to respond, StepChange Debt Charity, 2015. 21. Consumer spending rise troubles Bank of England, The Guardian, 24 November 2015. 22. For example, see: The Financial Capability of the UK, Money Advice Service, 2013. 23. The Financial Capability of the UK, Money Advice Service, 2013. 24. My Money Week survey (14-25 year olds), PFEG and Barclays, 2013. 25. MyBnk research, 2014. 26. Who creates money in the UK? Positive Money survey, 2014. 27. Which? Consumer Tracker, January 2016; Edelman Trust Barometer, 2015. 28. Ernst and Young Global Consumer Banking Survey: Winning Through Customer Experience, 2014; Financial Services Trust Index, Ennew, C., Financial Services Research Forum, 2009. 29. For more information about related ideas, see the work of Common Cause. 30. How elastic are preferences for redistribution? Evidence from randomized survey experiments, Kuziemko, I. et al, American Economic Review 105(4): 1478-1508, 2015. 31. Financial Capability Outcome Frameworks, New Philanthropy Capital, Kail, A. et al, 2014. 32. Financial Literacy, Financial Education and Downstream Financial Behaviours, Fernandez, D. et al (Forthcoming in Management Science), 2014.

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