9.5 The Financial Diaries Methodology can Contribute to Understanding How Young People in Conflict-Affected Settings Manage their Finances; thus Facilitating Effective YEO Program Design in Humanitarian Contexts

The International Rescue Committee (IRC) found gaps in the knowledge base relating to young people’s financial behavior in humanitarian or conflict-affected settings. This is a critical group to study as institutions that provide financial services may not exist. The IRC adapted the methodology detailed in Portfolios of the Poor (www.portfoliosofthepoor.com) in order to learn how youth in rural and urban Northern Uganda manage their finances. The study sought to explore different roles of financial and social capital, understand the financial role of youth in a household context, and detect differences in gender and geography (urban versus rural). Using local researchers, the methodology included: screening interviews with each respondent, in depth enrollment interviews, repeated cash flow reconciliations, guided participant photography exercises, and indepth qualitative interviews. The methodology is designed to understand daily financial management practices and how those practices relate to young people’s financial and social capital.

9.5.1 Noteworthy Results: IRC's Study of Youth Financial Management in Northern Uganda

IRC’s study of financial behavior in Northern Uganda focused on poor young people (83 percent of the sample was living on less than $1 a day).

  • Youth begin earning money at a young age, and expected contributions increase significantly when they leave school.
  • These young people appear to be testing a wide range of livelihood strategies in their transition to adulthood and rely heavily on undesirable casual work, because of its accessibility and reliability as an income stream within local economies. Hardly any of the youth are doing just one job; many need a variety of sources of income.
  • Young people are saving a significant share of their earnings using almost exclusively informal mechanisms. Photography research exercises revealed that young people saved money in suitcases, basins, or under the mattresses in their house; many lost savings due to theft or fires.
  • Participants in the study learned about financial management by doing and by observing older relatives. When it comes to seeking advice, they have much more confidence in older relatives than peers. Older female relatives frequently served as “money guards” who held youth savings and helped them think through spending.
  • Youth considered banks to be safe places but were frequently too far away to access or they required to great an amount of money; while there were some challenges with savings groups, they were generally perceived to be a viable mechanism to accumulate small amounts over time.
  • Despite limited market opportunities and low levels of education, these vulnerable youth are optimistic about their financial futures, believing that farming and running businesses will generate wealth.
  • Rural youth saw farming cash crops and land ownership as the key to financial stability. Urban youth saw wealth as tied to business and salaried jobs; they realized the importance of formal education to get those jobs. Boys’ financial goals included investing in businesses to get rich while girls focused on building a safety net for the family.





IRC’s study on youth financial management answers important questions about young people’s aspirations as well as their savings and spending habits. This knowledge can lead to more effective program design for all aspects of YEO programming. In the following text box, IRC provides readers with a practical tool which asks, “Do you know the following about young people in your programs, and are you asking the right questions to find out?”

9.5.2 Checklist: Do You Know How Young People Manage their Finances?

✔Where do young people save money?

✔If they save money in the house, where?

✔Do they use a “money guard” (i.e. someone who would help them think through their spending decisions)?

✔Who do young people turn to for advice?

✔Do boys and girls have different financial expectations and/or objectives?