Transtheoretical Model of ChangeTranstheoretical Model of Change

Jean W. Bauer, Ph.D., ProfessorSeohee Son, Ph. D. CandidateUniversity of MinnesotaMarch 24, 2009

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Getting Grounded: Theories to Guide UsGetting Grounded: Theories to Guide Us

Background

Key questions for financial educators: How can financial educators motivate people

to increase their positive actions toward achieving long-term financial stability?

How can financial literacy programs be more effective?

Consider psychological and behavioral theories from other disciplines

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Background

Transtheoretical model of Change (TTM) How the brain works in relation to financial

education Individual money personality

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Transtheoretical Model of Change (TTM)

The TTM explains the process of change that individuals go through as they attempt to modify maladaptive behaviors.

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Stage of Change Process of Change

Precontemplation Cognitive process (e.g., Consciousness raising, dramatic relief, environment reevaluation, self-reevaluation, and self-liberation)

Contemplation

Preparation

Action Behavior process (e.g., reinforcement management, helping relationships, stimulus control, and counterconditioning)

Maintenance

Change stage

Precontemplation: Individual is not ready to take action and change behavior in the next six months.

Contemplation: Individuals is getting ready to take action and intends to change behavior in next six months.

Preparation: Individuals is ready to take action and intends to change behavior in the next 30 days.

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Change stage (cont.)

Action: Individuals actually change behavior, but made behavior change less than six month ago.

Maintenance: Individuals have overtly changed their behavior and it has lasted for more than six months.

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Transtheoretical Model of Change

Strengths: Identify the stage at which individuals are ready

and able to change their behavior Apply appropriate educational interventions

tailored to meet individuals’ specific needs at that stage

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Turning Points and Trajectories

8Source: Khaw, L. & Hardesty, J. L. (2007). Theorizing the process of leaving: Turning points and trajectories in the stages of change. Family Relations, 56, 413-425.

Theory Based Financial Education

A theory provides practitioners with a baseline for how individuals behave

A theory enables practitioners to predict what might happen when certain conditions are present

A theory gives practitioners a context for evaluating financial education and relevant policies

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References Association for Financial Counseling and Planning

Education (2006). Closing the gap between knowledge and behavior: Turning education into action. Financial Counseling and Planning, 17, 73-90.

Khaw, L., & Hardesty, J. L. (2007). Theorizing the process of leaving: Turning points and trajectories in the stages of change. Family Relations, 56, 413-425.

Lyons, A. C., & Neelakantan, U. (2008). Potential and pitfall of applying theory to the practice of financial education. The journal of Consumer Affairs, 42, 106-112.

Xiao, J. J., O’Neill, B., Prochaska, J. M., Kerbel, C., Brennan, P., Bristow, B. (2001). Application of the transtheoretical model of change to financial behavior. Consumer Interest Annual, 47, 1-9.

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