Researcher

The Make Your Path (MY Path) initiative provides disadvantaged youth with peer-led financial capability trainings, a savings account at a mainstream financial institution and incentives to set and meet savings goals. The program focuses on youth earning their first paycheck—a critical “teachable moment” to promote savings and connect youth with mainstream financial products.

Over the last several decades, there has been a well-documented trend away from defined benefit plans toward defined contribution plans, in which an employee's retirement income depends on contributions to the plan along with the investment earnings on those contributions. Current workers increasingly must decide how much to contribute to retirement plans and how to invest plan contributions.

Increased policy and academic attention has been placed on promoting retirement savings early in the life course. This study investigates the extent to which retirement savings behavior among young persons, a population for which retirement savings is important but typically low, differs by marital status. We draw national survey data on young adult households (ages 22 – 35; N = 3,894) from the U.S. Federal Reserve Board’s Survey of Consumer Finances (SCF). Results reveal considerable differences by marital status.

The majority of research on the retirement decision has focused on the health and wealth aspects of retirement. Such research concludes that people in better health and those enjoying a higher socioeconomic status tend to work longer than their less healthy and less wealthy counterparts. While financial and health concerns are a major part of the retirement decision, there are other issues that may affect the decision to retire that are unrelated to an individual’s financial and health status.

Traditional economic theory posits that people make decisions by maximizing a utility function in which all of the relevant constraints and preferences are included and weighed appropriately. Behavioral economists and decision-making researchers, however, are interested in how people make decisions in the face of incomplete information, limited cognitive resources, and decision biases.

Minority groups, particularly Hispanics and Blacks, are less likely to use formal financial advice compared to their White counterparts and have lower levels of financial literacy on average. This gap in literacy may have important implications for savings, investing, and retirement planning. To better reach these groups and improve financial literacy, the literature recommends making access to financial education easier, targeting the education to the population, and delivering it through preferred methods.

This article provides a brief overview of the field of financial education and explores some of the challenges and potential solutions. The author describes developments in the contemporary financial education movement since the 1990s and the background economic changes that stimulated its growth; reviews currently available financial education initiatives for youth and adults and discusses the evidence about its effectiveness as well as broader challenges for the field. The article concludes by highlighting both general and specific examples of efforts to move the field forward.

We evaluate laws designed to protect borrowers from foreclosure. We find that these laws delay but do not prevent foreclosures. We first compare states that require lenders to seek judicial permission to foreclose with states that do not. Borrowers in judicial states are no more likely to cure and no more likely to renegotiate their loans, but the delays lead to a build-up in these states of persistently delinquent borrowers, the vast majority of whom eventually lose their homes. We next analyze a "right-to-cure" law instituted in Massachusetts on May 1, 2008.

This article provides a plain-language description of behavioral economics and the role of common biases in financial decisionmaking, and reviews ways in which the findings of behavioral economics can help structure financial education and public policy.

This paper tests for the presence of age and gender discrimination in the loan underwriting process. We modify the tools used during the past exams to test for racial discrimination and apply them here to test for the presence of disparate treatment on the basis of age and gender. Using HMDA data along with data from 18 fair lending exams recently conducted by the OCC, between1996 – 2001, we find no evidence of systematic discrimination on the basis of age or gender. Further, the tools used and tested for in this analysis are now readily available for use in future fair lending exams.