Raleigh, North Carolina – Low rates of financial literacy in the United States remain a costly problem, handicapping the efforts of people to live their best lives. To help address the issue, Institute of Consumer Money Management (ICMM) announced today that its funding project, the NOVA Financial Lab, launched on February 15th.
The NOVA Financial Lab is the newest installment of NOVA Labs, a free, online platform from the PBS science series that engages teens and lifelong learners through science-based games and interactives. Watch the trailer here.
A nonprofit organization located in Raleigh, North Carolina, ICMM conducts and provides funding for research that informs the design of educational tools to promote positive spending, saving, and earning behaviors among moderate- to low-income consumers. “I am thrilled that ICMM has the opportunity to fund this ground breaking project to promote sound financial behaviors for the young people in America,” says Dr. Diane Chen, the Executive Director of ICMM. “The collaboration between CAH and NOVA represents the intersection of innovative behavioral economic theories and cutting edge learning technology.”
For its latest Lab, NOVA teamed up with Center for Advanced Hindsight (CAH) at Duke University to create a game designed to help players understand how we make financial decisions and how to develop habits to overcome the behavioral biases that often get in our way. Such biases include “opportunity cost neglect,” where we focus only on the spending decision right in front of us, and “mental accounting bias,” which can cause us to treat money differently depending on where it came from. The NOVA Financial Lab provides a fun, safe place for players to practice managing spending, paying off debts, and investing for the future.
“Financial education is an area of high need in the U.S., and we’ve been thrilled to work with world-class researchers to create a game that can help prepare young people to achieve their goals,” said NOVA Labs Editorial Director David Condon. “Research has shown that games foster experience-based learning by providing a safe place for players to experiment with strategies, learn from failure, and develop better habits.”
Hosted by financial educator Yanely Espinal, the Lab starts players off with a series of short introductory videos defining financial well-being, exploring financial behavior, and looking at how and why we make certain financial decisions. Players will learn about the science behind our behavior and decision making when it comes to money, and use that knowledge to develop habits that can actually increase financial wellness.
Following the introduction, players pick a pet—either Cash the Cat or Bones the Dog—who will join them through three fun and challenging mini-games:
● In Shopportunity Cost, you’re trying to sneak your pet into a concert—which means you have some shopping to do. With each item you need to purchase comes a challenge: how to maximize your pet’s happiness while sticking to your budget. Because of our tendency to focus on the choice right in front of us—without considering the items we could buy with that money later—it’s harder than it sounds.
● In Budget Buster, your job is to take care of your pet, seeing to both its basic needs and overall happiness, for six months. To do it well, you must learn how to break your expenses down into useful “buckets” to help organize, evaluate, and track your spending. But don’t get too comfy—even the best plans should be adjusted when surprises, both good and bad, happen.
● In Exponential Potential, your pet has taken a peek at the future and it’s not looking very good. Luckily, they have you and a time machine to help them decide how to pay off debts and make investments in order to maximize their net worth. Success depends on your ability to master compound interest—a concept we humans struggle to comprehend—and make it your friend, not your enemy.
Each mini-game is designed to help players identify key behavioral biases that tend to crop up when we think about money, practice strategies to overcome these biases, and, hopefully, develop a new set of healthy financial habits along the way.
About ICMM. The Institute of Consumer Money Management (ICMM) is a nonprofit organization located in Raleigh, North Carolina. It was established in 2016 with an endowment from a nonprofit credit counseling agency with the mission of helping individuals build a sustainable financial future for themselves and their families. ICMM conducts and provides funding for research that informs the design of educational tools to promote positive spending, saving and earning behaviors among moderate- to low-income consumers.
About NOVA Labs. NOVA Labs is a free digital platform that engages teens and lifelong learners in games and interactives that foster authentic scientific exploration. From predicting solar storms and constructing renewable energy systems to tracking cloud movement and designing RNA molecules, NOVA Labs participants can conduct investigations by visualizing, analyzing, and playing with the same data that scientists use. Each Lab is unique, and focuses on a different area of active research. But all of them illustrate key concepts with engaging and informative videos and guide participants as they answer scientific questions or design solutions to current problems.
About CAH. The Center for Advanced Hindsight designs and tests interventions to people happier, healthier, and wealthier. CAH leverages research gleaned from behavioral science to create interventions that lead to positive financial and health behaviors. The lab is led by Behavioral Economics Professor Dan Ariely and is composed of researchers and experts in product design, economics, psychology, public policy, advertising, business administration, and more. To fulfill its mission, CAH partners with organizations, including fintech companies, credit unions, banks and nonprofits that believe their work could be improved through insights gained from behavioral economics.
To Contact ICMM: dchen@icmmnc.org
To Contact NOVA Labs: david_condon@wgbh.org