Grants Approved in 2006 Association for Financial Counseling and Planning Education Columbus, OH Improving the Financial Management of Intact and Divorcing Couples AFCPE is delivering a six-part continuing education program, Money 1 to 1, to members of non-finance professional counseling associations dealing with relationship and divorce issues. The training enables counselors to assist clients with financial communications, budgeting and cash flow management, managing investments and residences, and tax issues in divorce. In exchange for receiving the education, counselors are required to provide pro bono services to individuals or couples. Grant Amount: $629,310 Project Term: 24 months Grant Cycle: 2006 General Type: Education First Nations Development Institute Longmont, CO Investing for the Future: Native Community Partnerships First Nations is preparing an instructor guide and a resource guide for trainers who provide investment education to Native American communities. The guides serve as companion pieces to First Nations’ investor education curriculum (produced with earlier Foundation support). First Nations is also building awareness of the importance of investor education among tribes through national training events, and working with two Native American communities to implement the training program as a model for peer education. All of these activities are supported by an InvestNative Web portal (currently under development) to make the investment education materials and resources available in electronic form for tribal members and trainers desiring to learn more about investing in the Native context. Grant Amount: $447,475 Project Term: 36 months Grant Cycle: 2006 General Type: Education National Bureau of Economic Research Cambridge, MA Managing Risk and Minimizing Fees Researchers at NBER are determining whether disclosure policies can mitigate two types of cognitive errors common among individual investors. The first error is the narrow framing fallacy, wherein investors evaluate risk in isolation rather than in the context of their overall portfolio. The second error is the failure to consider mutual fund management fees. The team is conducting experiments to test different forms of disclosure and their impact on helping investors understand risk and minimize fees. Grant Amount: $432,850 Project Term: 24 months Grant Cycle: 2006 Disclosure Type: Research Pace University School of Law New York, NY Guide to Dispute Resolution for the Small Investor Experts at Pace Law School are developing and distributing an educational guide to help small, individual investors understand their legal rights and responsibilities in order to avoid disputes, or seek resolution through arbitration or mediation in the event of a dispute. Grant Amount: $153,725 Project Term: 13 months Grant Cycle: 2006 General Type: Education Stanford University Stanford, CA Individual Differences in Financial Risk Taking Across Lifespan An interdisciplinary team headquartered at Stanford is employing historical, psychological and neural methods to analyze individual differences in financial risk-taking at various stages of the life-cycle. The research will identify characteristics that predict optimal risk-taking and mistakes. A resulting Web-based tool will help individuals assess their financial risk-taking and optimize their financial decisions. Grant Amount: $401,514 Project Term: 24 months Grant Cycle: 2006 Life-Cycle Type: Research University of California Los Angeles Los Angeles, CA How Investors Are Facing the Longevity Risk: The Role of Annuities Focusing on the use of annuities, UCLA researchers are studying how individual investors are facing longevity risk. They are surveying a broad base of investors to determine: 1) the extent to which investors are addressing longevity risk and their preferred methods of doing so; 2) whether annuities can provide a solution to the challenge; and 3) what features of annuities make them unattractive to the individual investor. The goal is to propose changes to the current features of annuities to make them more attractive to investors. These changes will be tested through a series of surveys and laboratory experiments. Grant Amount: $484,000 Project Term: 24 months Grant Cycle: 2006 Life Cycle Investing Type: Combination University of Central Florida Orlando, FL Financial Reporting Simplification: Understanding Investor Decision-Making Behavior and Disclosure Preferences The University of Central Florida project is seeking ways to reduce disclosure complexity. In particular, researchers are examining how disclosures made in management’s discussion and analysis (MD&A) and the footnotes accompanying financial statements are used by institutional and retail investors. Each group is being studied as part of a systematic examination of the value and relevance of current disclosures, an understanding of desired disclosures in the MD&A, and insights into presentation preferences. Grant Amount: $324,125 Project Term: 24 months Grant Cycle: 2006 Disclosure Type: Research Women’s Institute for a Secure Retirement Washington, DC Nurses’ Investor Education Project: Opportunities, Challenges, and Moving Forward In partnership with the Center for American Nurses, WISER is creating a replicable investor education program for nurses. The project begins with a survey of nurses to identify important issues, and will include a Nurse Investor Education Report with benchmarking to the national nurse workforce. WISER and the Center will tailor existing investor education materials and conduct financial education seminars for the target audience. Grant Amount: $495,250 Project Term: 36 months Grant Cycle: 2006 General Type: Combination