Retirement Policy: DOL Interested in Role of Smartphone Apps Aimed at Financial, Retirement Literacy
By Florence Olsen
The Department of Labor has been exploring ideas for using smartphone applications to influence the savings habits of young people, according to a DOL official who spoke at a retirement policy event July 12 at which the official asked college students whether information technology could be used to improve financial literacy.
“I’m curious, is that a part of the solution?” said Michael L. Davis, deputy assistant secretary of DOL’s Employee Benefits Security Administration.
Virginia Tech student Matt Maranowski answered that smartphone applications are “a step in the right direction,” especially the types of apps that many banks provide for making deposits and tracking savings and checking account balances.
“The apps are extremely fast. You swipe your card, and it’s in the app about five minutes later,” Maranowski said.
Significant Cultural Shifts
College students generally are uninterested in reading paper statements that banks send out monthly, Maranowski said. “There’s no point in checking because a monthly statement is so far behind where you’re actually at,” he said.
Other Virginia Tech students offered similar ideas, and Davis responded by saying their comments reflect “some pretty significant cultural shifts.
Maranowski also suggested to Davis that advertising similar to recent anti-smoking campaigns might get college students to pay attention to the need to start saving for retirement now.
“Something similar to that in regard to retirement savings could show the realities of someone who doesn’t save for retirement and what their situation looks like,” Maranowski said. It could be a 30-second commercial showing “what a day is like for someone who has no retirement savings and is living on nothing,” he said.
“Our generation is so used to very upfront, in-your-face, action-packed stuff, so I think hitting them with the harsh reality of what it’s like is something that could really shock people into thinking, ‘Well maybe this is more important than I’m willing to believe,’ ” Maranowski said.
Davis commended Maranowski and his fellow students who were invited to speak at the event as winners of an essay competition sponsored by the financial literacy organization iOME Challenge.
“I’m taking some things away from this conversation that we’re going to talk about in the office,” Davis said.
The event was sponsored by the Women’s Institute for a Secure Retirement.