#ReConf2014 | NeighborhoodPartnerships.org

RE:AlignBehavioral Economics

And Assets

1) Our environment has a large, yet unrecognized effect on our behavior

2) Our intuitions about what drives our behavior are flawed

3) Emotions play a large role in our decision making

- Dan Ariely

A healthy community begins at home. REACH provides quality, affordable housing and

opportunities for individuals, families and communities to thrive.

Financial education classesIndividual financial coachingMatched-savings accounts

nudge verb \ˈnəj\

: to touch or push gently

: to push gently with your elbow in order

to get someone’s attention

: to encourage someone to do something

Merriam-webster.com

Boost self-control or activate behavior

Self-imposed or externally-imposed

Mindful or mindless Encourage or discourage

Nudging options

Encourage mindfulness

Create environmental cues

Activate helpful mental accounting

Mvelopes.com, Smartypig.com

Boost self-control

Map program process

“I want to buy a house”

Finds out about program

Enrolls in financial ed

Completes financial ed

Coaching, credit-building,

planning

Fills out IDA application

Opens IDA account

Saves money, earns match

Buys a home

Identify bottlenecks

“I want to buy a house”

Finds out about program

Signs up for info session

Attends info session, enrolls in financial ed

Financial ed, coaching, planning

Fills out IDA application

Opens IDA account

Saves money, earns match

Buys a home

Simplify and/or nudge

“I want to buy a house”

Finds out about program

Signs up for info session

Attends info session, enrolls in financial ed

Financial ed, coaching, planning

Fills out IDA application

Opens IDA account

Saves money, earns match

Buys a home

Encourage throughsocial proof

More social proof…

What’s next?From opt-in … … to active choice?

• Founded in 1975 as the first domestic violence shelter in the West

• Bradley Angle serves survivors of all genders, offering emergency shelter and community based services

• The Economic Empowerment Program started in 2009 to respond to demand for services that addressed safety and finances simultaneously

Choice Overload

• When faced with so many options, we often chose wrong

• Chocolate or vanilla versus

• Chocolate, vanilla, strawberry, mint chip, peanut butter, cheesecake, blueberry,

• Practice example: Days for making deposits

• Matched savings account offerings

Limited Attention

• Limited attention can interact with choice overload. Attention is finite and we all love to “multitask.”

• With limited attention a cost-benefits analysis becomes too hard and we “just pick one.”

• Practice example: Car shopping

Procrastination

• No explanation need!

• Practice example: Making activities “one-sitting”

• Setting artificial due dates

Loss Aversion

• The joy of winning $20 is less than the pain of losing $20. Loss hurt us more than we feel the joys of wins.

• Practice example: Missed deposit letters

Let’s Practice!

• Get into groups and discuss one way you can address a behavior change tenant at work or at home.

#ReConf2014 | NeighborhoodPartnerships.org

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