2014 OECD

Presented by: Professor Punam A. Keller, November 6, 2014

2nd OECD-GFLEC Global Symposium to Advance Financial Literacy

MAP: MOTIVATION-ABILITY-PLAN

Process for Developing MAP:

Motivation-Ability-Plan

M: What are your goals?

A: What get’s in the way?

P: Link your offer/plan to goals and barriers.

MAP: Checklist

TO MOTIVATE, LINK YOUTH VALUES/GOALS TO FL GOALS

• Which youth values could block or support what we offer at our school?

• How can we connect youth audience goals to our school FL goals and values?

INCREASE YOUTH FINANCIAL LITERACY BY OVERCOMING BARRIERS

• Do we know what gets in the way of youth believing in us?

• Do we understand decision-making trade-offs that prevent compliance?

DEVELOP THE PLAN

• Does our communication design encourage behavior change by creating action points?

• Which communication channels should we use?

• Can we create a user-friendly implementation method to increase follow through?

MOTIVATION What you have to offer is not always inherently

desirable. You have to market your idea by linking it to

what is inherently desirable to members.

08/27/97

Linking Education with Internal

Motivations: Means-End Chain

• Features don’t matter!! What matters is... • how people interpret the features

• how this interpretation maps onto peoples’ goals

• The goals give the features their power • determine the sort of inferences that are made (and the cognitive

processing)

• determine the level and type of affect involved in the choice

Need/Goal

Activated

Education

Feature/Decision

Interpretation or

Inference

Example: Means-End Health Action

Diabetes Test

Avoid Dependence

Being in control

Prevent blindness

Prevent heart, kidney

disease

Reduce sugar/cholesterol

Monitor sugar/cholesterol

Where most of the

conversation happens

Which of these values support or block

what you offer to Generation Y & Z

members 1. To feel like they can do and be what they want (that their

aspirations are achievable and not some far-off fantasy)

2. Autonomy: wants input on how they are learning and the

independence to do it

3. Work-life balance

4. Surrounded by diversity

5. Experiment

6. Causes: world issues, politics, and the environment

7. Not bothered about privacy

8. Fast-paced environment

9. Multi-tasking: get as much done as possible

10. Sharing: updating about personal tasks/experiences

Protection Checklist – Financial Records • Make a list of account and customer service numbers for:

• Checking and savings accounts

• Credit and charge cards

• Mortgage and home equity loans

• Auto loans

• Student loans

• Personal loans

• Cable, telephone, and utility companies

• Personal records - Personal records documents can be replaced, but it can take time. Plus, you

may need these documents to verify that you are the owner of the property that was damaged or

destroyed in the disaster to receive insurance help or other assistance. Gather and make copies of:

• Identification, including your driver’s license or passport

• Social security cards

• Birth certificates

• Marriage certificates and divorce decrees

• Titles, deeds, car registrations

• Financial records - Again most financial records can be replaced, but you will need your insurance

information if your property is damaged, or if you or a family member needs medical care. Keeping

this information safe will also help you avoid trouble if questions arise later about your investments,

taxes or workplace benefits. Gather and make copies of:

• Insurance policies

• A room-by-room inventory of your belongings

• Investment records

• Income tax information

• Pay stubs and employer benefits records

• Wills, living wills, trusts, medical powers of attorney

Example: Means-End Financial Action

Financial Digital

Checklist

Be Autonomous

Protect Yourself

Establish Ownership

Avoid delays

Personal and Financial Records

Account and Customer Service Numbers

MOTIVATION

QUESTION Should we conduct research on what motivates

youth? SOCIAL, ESCAPE, CHALLENGING,

SWEET, PLAY WITH ONE HAND…

ABILITY Many barriers get in the way of people doing what they

believe in! Identifying trade-offs is key to discovering

decision-making solutions.

Don’t just think about it…….you can

make it happen

I do not know how

much I will need

Don’t know where

to put $$

Don’t know how to use

FlexOnline

Few people like

me do it

Obstacles to Opening a

Supplemental Retirement Account

(SRA)

I can’t afford

$$

Too many

unexpected expenses

No time now

I do not have a

computer

My debt is too

expensive

Log ID & PIN are in

your packet

More than 60% of

employees contribute

Easy Solutions to Opening a

Supplemental Retirement Account

(SRA)

You can start with

only $16 per month

Make an investment

selection now. You can

change it at anytime

With the tax

benefit you will

save even more

Bring lunch 2/month

Carpool

Skip the latte

Start early &

your money

will grow fast

Computers are

available at HR

and the library

Use an online

investment calculator

Provided by Annamaria Lusardi, Economics,

and Punam Keller, Tuck School of Business,

in conjunction with the Retirement Savings Study.

$$ ??

Common Teacher Barriers and

Potential Solutions • I have no time….bundle with “down time” such as

transportation to school sports events

• I cannot answer the questions….provide training plus list of frequently asked questions and answers

• This school is about academics, not commerce...focus on FL and discipline

• They will forget anyway…give them wallet-sized reminders

• We don’t have the money…partner with private companies, higher education, school boards, and donors

• I won’t be recognized for the extra work…create school competition

• Someone else will teach them…and get the credit!

• It is not related to placement…encourage governments to make a FL test mandatory for all rites of passage including buying a home, car, getting a divorce, going to college, getting a credit card

When Benefits are Communicated People

will Activate Compliance Barriers

Profiling

Information

Income, Education, Age, Region,

Gender, Religion, Psychographics/

Lifestyle

Gains Losses

Engaging Self-esteem

Control

Choice

Prevent bankruptcy

Maintain lifestyle

Independence

Active

Travel

Feel financially deprived

No time to learn to save

Not now

Insufficient gains

Don’t know how

Not my responsibility

No control over spending

No need (look okay)

Wrong decision/action

Not Engaging Fun – feel good now

Rebellion – Can’t enjoy later

Popular – Drink/eat with friends

Makes work worthwhile

Physical appearance no matter

Status – Keep up

Power and control

Ego - Esteem

Escape - Distraction

Lots of debt, Interest fees

Anxiety about the future

Potential loss of home

Unable to cover basic costs

Depend on parents/relatives

No divorce

Cannot travel/visit friends

Get fleeced/robbed

Go to jail

Forego principles

1 2

4 3

Example: Earn-Save Tradeoff

ABILITY

QUESTION Should we do research on institutional,

service provider, and target audience

barriers and solutions?

PLAN The best intentions are never implemented. When

people get action prompts and plans they switch from a

deliberative to implemental mindset.

The Right Communication Can Prompt

Action

• Visit the Health and Wellness Assessment (HWA) website to develop an

action plan to maintain or improve your health. Now, or whenever you are

ready, you will have free access to powerful online coaching tools for

success.

• If you have already completed or plan to complete the HWA, you will receive

an annual $200 off your bi-weekly or monthly health insurance contribution

cost.

• The Health and Wellness Assessment is administered through HealthMedia

and is confidential. Results from all HWA responses will be summarized,

without identifying individuals, to determine trends in employee health.

I prefer to take advantage of this free tool to maintain or

improve my health and save $200.

I prefer not to take advantage and decline this

opportunity to get help in maintaining or improving my

health and wellbeing.

10.0%

27.0%

Opt-In

Jan-Sep 2010

Opt-In with

Financial Incentive

Oct 2010

58.3%

Enhanced Active Choice

During Annual Enrollment Nov-Dec 8 2010

Cumulative Completions

Provided by Punam Anand Keller, Tuck School of

Business, in conjunction with the Dartmouth

Hitchcock Medical Center.

Example: Enhanced Active Choice

Spending Decision Point

Actions you can take to reduce your credit

card debt and buy more for less money!

1. Live within your means.

2. Be a smart shopper, and compare prices and

quality.

3. Track your spending habits and develop a

budget or spending plan.

I prefer to take advantage of these tips to

decrease my credit card debt and buy the

same products for less.

I prefer not to take advantage and decline

this opportunity to get help in reducing my

credit card debt and I don’t mind paying

more for the same products.

Step 1- Motivate

• Highlight the

advantages of the

preferred action

and highlight the

losses of the

“wrong” decision

• Require an action

to help enforce the

follow through on

the decision (i.e.

checking a box).

• Lay out what is

involved

• Break down the

tasks into

manageable

sections

• Assign a time

frame to each

section

• Total time should

be under 30

minutes.

• Person must be able

to visualize the

realization of a goal

or a dream-

something

aspirational.

• What is the result of

the savings,

something tangible

in return.

• The reason should

reflect organization

goals such as long-

term financial

security and

wellbeing.

Step 2- Ability Step 3- Plan

Using MAP in 401k Enrollment

Communications

Provided by Punam Anand Keller, Tuck School of

Business, in conjunction with NARPP .

I never knew my employer would give me money for my RV (Retirement Vehicle)!

You get $50/pay = You ($38) + USA ($12)

You get $100/pay = You ($75) + USA ($25)

You get $250/pay =You ($188) + USA ($62)

By putting the power of Washington’s tax-deferred compensation to work for you, more goes into your

account than you put into it.

Yes, I want to increase my ability to pay for what I want when I stop working by taking advantage of the tax break.

No, I do not want to take advantage of the tax break even if it means I cannot get what I want when I want when I stop working.

1. 5 minutes. Check to see if you have: a) social security number _√_, and b) hire date _√_.

2. 10 minutes. Select the amount you want to take out of your paycheck (minimum: $15/paycheck, maximum: $188/paycheck. If you want, you can change this amount at a later date.

3. 5 minutes. Now you are ready to complete the enrollment form. You will need your employer’s name, number of pays/year, and department. Complete the form even though you may be unsure of some options. You can change the options later.

4. 5 minutes. Take the completed form to the HR department. You must return the form within 45 days of your hiring.

Provided by Punam Anand Keller, Tuck School of

Business, in conjunction with NARPP .

Sample 401k Communication

Provided by Punam Anand Keller, Tuck School of

Business, in conjunction with NARPP .

Next Steps: Application of Active Choice to

Financial Decision-Making Example: Employer/Employee MAP

Example: Employer/Employee Plan

Innovative Channel Design Options

Celebrities

Employers

Pastors

Financial Ambassador

Teachers

Financial institutions/banks

Youth Centers

Church

Clubs

Libraries

Schools

Social Media

Games

Stories

Reality Shows

Apps

Songs

PLAN

QUESTION Is it worthwhile documenting how youth

were able to make good financial

decisions?

Key takeaways

• Get youth insights on challenges and barriers. The best designs anticipate and overcome audience challenges by co-producing solutions with the target audience.

• More is not always better. Reduce the number of choices you offer at any point in time. Consider using choice architecture to prompt action and to enable youth to see the pros and cons of not engaging.

• Provide a plan to help youth switch from deliberation to implementation.

• Last and most important, link the goals and values of Financial Literacy to the goals and values of the channel partner and the youth target audience.

Thank You!