Association for Public Policy Analysis & Management

The mandate to innovate in social policy also invites researchers to innovate with the methods we use to study social processes. Qualitative methods are ideally suited to this task because their open-ended inquiry results in identifying new insights about everyday life and the larger processes that structure it. Consumer finance presents a case in point. Every individual and family makes choices about how to spend, save, or invest their money in ways that are simultaneously personal but shaped by social values, unequal access to institutions, and a credit reporting system with tremendous influence on a person’s opportunities and constraints. These conditions sometimes leave consumers, especially those who are low-income, have little or poor credit history, or are otherwise financially vulnerable, feeling bereft of agency in a stacked system. This stands in contradiction to policy interventions that seek to imbue them with more financial education, literacy, or empowerment.

This paper draws from an Abt project conducted for the Consumer Financial Protection Bureau under its Research Innovation and Support Services initiative. This paper focuses on the contributions of a small sample (6) of ethnographic case studies with consumers to enriching the rest of the data generated from focus groups and questionnaires with 300 participants. The overall project generated formative evidence on consumers’ behaviors that could be the targets for innovative programs to improve their financial decision-making and ultimately financial outcomes.

Case study observations of participants’ money management practices and interactions with credit reports provided much more nuanced and grounded detail into what a participant’s summary statement in a focus group meant in practice—including sometimes the contradictions between public speech and private practices. Account management and credit report exercises identified concrete examples of the range of practices that work well for these consumers as well as the anxiety, frustration, and despair that accompanies thwarted efforts. The paper also discusses participants’ “financial life stories,” which contextualize contemporary decisions in an overall life trajectory. While many facets of the financial market are depersonalized and sometimes feel outside each consumer’s control, these financial life stories return agency to the storytellers to interpret their experiences. It is from the grounded evidence of what consumers experience, and how they interpret it through self-defining narratives, that policy can have powerful impacts that meet Americans’ personal finance needs.