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Why financial education just doesn't stick

April is Financial Literacy Month, and just as the crocuses and daffodils are sprouting, banks and other financial firms are announcing a new crop of financial education programs.

More financial education is arguably a good thing—but so far, financial literacy initiatives haven't led to noticeable improvement in consumers' financial knowledge or behavior.

A survey from the National Foundation for Credit Counseling released earlier this month found that 61 percent of Americans do not have a budget, the largest percentage in six years. As for confidence, 41 percent of the survey respondents gave themselves a C, D, or F for their financial know-how.

"We've been beating our heads against the wall for decades," said Gail Cunningham, a foundation spokeswoman.

Amanda Rohde | E+ | Getty Images

What gives? Experts are divided.

It may be that progress with financial literacy will just take time, said Annamaria Lusardi, professor at the George Washington University School of Business.

"We don't give financial education lessons and people run back to their offices and change their financial behaviors," she said. "That's not how it works."

Lusardi points to public antismoking campaigns as a gauge of how long it takes to change behavior on a large scale.

"We had lots of costs associated with people having to have long and extensive treatment,' she said. But despite warnings from the Surgeon General and myriad public health campaigns, "look how long it took to decrease the smoking. Many years later, I think we have made progress."

Gary Blank, senior vice president for public affairs and policy at Fidelity Investments, has another idea. "We don't have a concerted national approach across the country that is touching every student, or a concerted national approach across the country that is touching every adult," he said. "Right now it is piecemeal."

Then there is the matter of which financial information is reaching consumers. A study by the Consumer Financial Protection Bureau found that direct spending on financial education from all sources—nonprofit, corporate, government—amounted to $670 million per year, or roughly $2 per American. (Financial services firms contribute $31 million of that, the bureau found, along with $129 million on supporting services around financial education.)

But financial services firms also spend $17 billion annually on marketing consumer financial products, the bureau found—an amount equivalent to $54 per American. With that kind of disparity, the simple educational messages may simply get drowned out by marketing pitches offering quick profits and improbable returns.

"Managing your financial life is hard," said Gail Hillebrand, the bureau's associate director of consumer education and engagement. "We do get a lot of information on financial products and services from the providers of those services. In that context, it's not surprising that we have a ways to go."

Progress in financial education is also hampered by minimal information about which approaches work best. The President's Advisory Council on Financial Capacity concluded in a report that while many financial literacy programs are available, "quality and efficacy indicators are sorely lacking and there is no clear relationship between the quality of a program and its availability."

Nan Morrison, president of the Council for Economic Education, agreed. "Standards, great lessons, professional development and assessment don't exist across the board in this county for financial literacy," she said.

"Once there are standards, then you need training—how to teach," Morrison added. "Then you need assessments."

Nonetheless, there are encouraging signs in the world of financial literacy. For example, Lusardi points out that the Organisation for Economic, Co-operation and Development in 2012 started measuring financial literacy among students around the world, The results will be released in July.

"That can provide more evidence" of the need for financial education, "and I think more stimulus," she said.

Lusardi is also enthusiastic about some new financial literacy initiatives, like a program from the Consumer Financial Protection Bureau to provide financial education through public libraries. Since libraries now provide broader community services, like job hunting and resume assistance, financial education materials are a kind of natural extension.

A few existing initiatives have also shown promise. One, a curriculum developed by the Council for Economic Education, was implemented in Tennessee in 2010. Before the start of the program, students were asked a serious of questions to gauge their financial literacy, and just 3 percent of middle school students got 70 percent or more correct. After the curriculum, that figure rose to 40 percent.

Fidelity Investments is now partnering with the council to extend the reach of the curriculum, which is called Financial Fitness for Life. Fidelity's Blank says a small group of Fidelity volunteers can have an impact on a large number of students by training a group of teachers who then take financial literacy lessons back to their students.

Fidelity won't disclose the resources it has committed to this financial education effort, but whatever its size, Lusardi says partnerships like this are necessary. "When public resources are very limited, these partnerships with institutions in the private sector are very important."

Maybe they will even tilt the marketing-education scales a bit.

—By CNBC's Kelley Holland.

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