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  • >> Hello, everyone. Thank you for joining us today for our webinar on Behavior Economics

  • 101. My name is Michael Roush, and I'm the manager of financial empowerment and innovation

  • at the National Disability Institute. Today, I am joined by Wynne Lum, philanthropy manager

  • at Bank of America; Nicole Truog, associate director, the Center for Financial Security

  • at the University of Wisconsin Madison; and Anya Samak, who is the assistant professor

  • at the University of Wisconsin Madison. Before we get started with today's webinar, we do

  • have some housekeeping tips that we need to go over. My colleague, Nakia Matthews is going

  • to cover that information. >> Good afternoon, everybody. The audio for

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  • You can also use this to control the sound if the sound becomes distorted. If you do

  • not have sound capabilities on your computer or you prefer to listen by phone, you can

  • dial the number you see here. I will also put the information into the chat box. You

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  • and answer session at the end of the webinar. Please use the chat box or the Q&A box to

  • send any questions you may have to us during the course of the webinar. We will directly

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  • into the webinar platform, you may also submit questions by e-mailing them directly to me,

  • Nakia Matthews at nmatthews@ndi-inc.org. Please note that this webinar is being recorded and

  • that the materials will be put on the NDI website. If you experience any technical difficulties

  • during the webinar, please use the chat box to send me a message, Nakia Matthews. Or you

  • may e-mail me at nmatthews@ndi-inc.org. >> Great. Thank you, Nakia. Today's webinar

  • is our second in a three-part series that we are doing with support from Bank of America.

  • Our first webinar was introducing us to financial capabilities and key concepts and strategies

  • surrounding financial capability. Today's webinar is to introduce us to Behavior Economics.

  • What is it? What is the impact of Behavior Economics? Our guests today will help us understand

  • this topic. We are thankful for our friends from the University of Wisconsin, the Center

  • for Financial Security, for partnering with us today on this webinar. Please note that

  • today's webinar is not disability specific as we are exploring this topic together. And

  • then together we will ponder how Behavior Economics applies to the work that we are

  • doing together to advance the economic self-sufficiency for persons with disabilities. Our objective

  • for today's webinar are to define Behavior Economics, understand key components and look

  • at strategies to use as we work to create positive financial habits for clients we serve.

  • I would like to thank our sponsor of today's webinar, Bank of A merica, for their support

  • of expanding the financial capability of persons with disabilities. I would also like to thank

  • Bank of America for choosing the National Disability Institute to be one of the nonprofit

  • organizations highlighted on Bank of America's Times Square billboard this weekend and the

  • weekend of June 1st. If you are in the New York City area and can make it down to times

  • square, please do and take a picture in front of the billboard. When our logo comes up.

  • And send it to us. We'd love to highlight our partners with the Bank of America billboard

  • and NDI logo displayed and we're very honored for this opportunity and we thank Bank of

  • America for highlighting the National Disability Institute. For those of you that are new to

  • the National Disability Institute, before we turn it over to our presenters, I would

  • like to share with you a little bit of information. The National Disability Institute is a national

  • nonprofit organization dedicated to building a better economic future for Americans with

  • disabilities. We are the first national organization committed exclusively to championing economic

  • empowering -- empowerment, and financial stability for all persons across the full spectrum of

  • disabilities. National Disability Institute affect change through public education, training,

  • technical assistance, and policy development to help the one in three Americans with disabilities

  • living in poverty take steps towards brighter financial futures. To learn more about the

  • National Disability Institute, go to RealEconomicImpact.org. At this time, I would like to turn it over

  • to our friends at Bank of America. And we have Wynne Lum, who is the fanatical the -- the

  • philanthropy manager. Wynne, have you've been able to join us? -- have you've been able

  • to join u s? -- have you been able? Wynne will be joining us in just a minute. Until

  • he does join us, Nicole, can I turn it over to you?

  • >> Yes. Can you hear me okay? >> Perfect. Thanks, Nicole.

  • >> No problem. I'm delighted to participate today. I wanted to take a moment to say a

  • few words about the Center for Financial Security -- financial security. We are and applied

  • research Center and our research really focuses on working to build financial capabilities

  • for families and individuals over the life course. We do this through research that looks

  • at the measurement of financial capabilities, targeting interventions to populations at

  • risk, and also testing strategies and products and services. And so I couldn't leave you

  • today without a little plug for the center and have provided some resources here. I hope

  • you'll take a look at our website where we have a lot of our research published and also

  • policy briefs that are two to three page snapshots of our research. And all of our research,

  • we couldn't do it without our affiliates. And Anya is one of 50 plus affiliates who

  • are researchers across the country and across the campus working to look at financial capabilities.

  • If you're interested in learning more about financial security over the life course, we

  • do have an online conference coming up that's the pathways 2013 link. So thank you to Michael

  • and his team. I look forward to hearing more from Anya.

  • >> Great. Thank you, Nicole. And thank you for joining us today and for connecting us

  • with Anya. I think we might have Wynne back on the line, before we turn it over to our

  • main presenter, Wynne will be joining us momentarily. Nakia, I sent you the number. One piece I'd

  • like to share with you before Wynne joins us is that we have a partnership with Bank

  • of America's disability -- Disability Advocacy Network. And we are partnering with members

  • of the Bank of America team to increase awareness on financial wellness for persons with disabilities

  • through two opportunities. We have the financial education training as well as disability awareness

  • training for VITA volunteers, tax and asset building coalitions, debt management partners,

  • IDA and financial education providers. If you are interested in being connected with

  • a representative from Bank of America through the Disability Advocacy Network, please send

  • me an e-mail, Michael Roush, at mroush@ndi-inc.org. And we will be able to connect you to these

  • volunteer opportunities within your area. And so now what I'd like to do is I think

  • we have Wynne Lum on the l ine. So, Wynne, I'll turn it over to y ou.

  • >> Michael, thank you very much. Thank you for talking about the Disability Advocacy

  • Network at Bank of America. You mentioned earlier the admission -- the mission for the

  • National Disability Institute. Your mission is the reason why we are pleased to partner

  • with you and your organization, to help consumers be better able managing their finances. And

  • you had mentioned the times square recognition -- we were recognizing a handful of our have

  • -- partners and the wonderful work they do. Thank you for doing the work that you are

  • doing. This is a great time to be part of this conversation and this learning session

  • we're having. I'm in between frazzled -- so this is a great day you picked for this conversation.

  • When I mean I'm in between, we just finished with Mother's Day. And I was just stressed

  • out on what to get and the gifts I had to buy. And now were going from Mother's Day

  • to Father's Day to graduation, prom and everything else we have to do, not to mention necessities

  • that we all have. So how do you pay for all that? What used decide to get? What's going

  • to make mom and dad happy? What's going to make the graduate happy? And then do -- cannot

  • even afford to do it? I don't have to worry about affordability, do I? The marketers are

  • telling me that I can pay with easy pay, I can delay away, installment, I can pay with

  • other people's money. And so all of this is stressing me out because we all know that

  • impulsive buying can lead to some bad habits. And we need to be more thoughtful, we need

  • to be more deliberate, we need to be able to help ourselves manage our finances. That's

  • one of the reasons I'm interested in the work that the National Disability Institute is

  • doing but also the work that's being done by the University of Wisconsin Center for

  • financial security. They are some of the leading pioneers and experts and smart people doing

  • this work under the leadership of Dr. Michael Collins and Nicole Truog, who we're going

  • to hear from today, and Anya Samak in all the work they're doing to help us achieve

  • financial security. So we at Bank of America believe that consumers should be more thoughtful

  • and should be able to help themselves, because better consumers make better customers for

  • us but they also help relieve the stress so that we're not all frazzled with understanding

  • how to manage our finances. Michael, I'm interested in learning from the panelists today and what

  • they're doing. Thank you for letting us be a part of this.

  • >> Great. Thank you, Wynne. We appreciate you being on the call today. So now is the

  • main part of our webinar presentation today. And we're really excited to bring this topic

  • to you all. It's a topic that we've been exploring and looking at as we've traveled across the

  • country. Partners from both the asset building community, financial services as well as the

  • disability community have said to our team, what is Behavior Economics? What does it include?

  • Please bring us some information on it. And so when we reached out to the University of

  • Wisconsin, they connected us with Anya Samak, who is going to share some great information

  • with us today. She's been studying Behavior Economics. And we're delighted to have Dr.

  • Samak join us today. So with that, Anya, I'm going to turn it over to you.

  • >> Great. Hopefully everyone can hear me. >> Sounds great.

  • >> Yes? Good. My name is Anya Samak. I've been a professor at the University of Wisconsin

  • Madison and Center for Financial Security the past year. Before that, I was doing behavioral

  • economics research at the University of Chicago. And I received my PhD in experimental behavioral

  • economics from Purdue University. So I've been working on behavioral Econ for quite

  • a while and also mostly working on general behavioral principles that can be shared across

  • many domains. Not just thinking about why people choose to save versus spend or how

  • people to -- choose to allocate their money and what behavioral biases exist in that decision

  • but also very related topics such as, why do people choose to exercise or not? Why do

  • they choose to eat healthy or not? How do people decide about philanthropic giving and

  • so on? Today I'm going to be more general and you'll learn a little bit about the different

  • main principles in behavioral economics and how they can be applied to contact. So when

  • I talk today, I'm going to break the presentation up into three components. First, I'm going

  • to tell you what but it -- Haverhill economics is. As Michael said, behavioral Econ 101.

  • Then I'm going to tell you a little bit about how economists use experiments to study behavior.

  • Finally I'll give you some lessons on how insights from behavioral economics can be

  • applied in real settings and give you some examples of studies that have done this. So

  • before we get started I'm going to tell you about economics. When a lot of people think

  • about economics or if I meet someone at a party and tell them that I'm an economist,

  • people usually assume that when I'm interested in is studying money. How do people decide

  • to spend their money? What does the GDP look like? And that is macroeconomic q uestions.

  • Really, as economists, we think about any decision being an economic one, because microeconomics

  • is really the study of how individuals or firms make decisions to allocate limited resources.

  • Limited resources could be money but it also could be time. You could think about choosing

  • whether to buy a TV or invest that money in a retirement account as an economic decision.

  • You could also think about choosing whether to spend time watching TV or choosing to spend

  • that time exercising as an economic decision, because you're allocating limited resources.

  • As economists, we have two main components of a decision. The first component is the

  • a c onstraint. That tells us what the individual can do. It gives us the amount of money they

  • have to spend, gives us the hours in the