Presentation Format and Financial Literacy: Accessibility and Assessability of Retirement Savings Statements
Journal of Consumer Affairs, Forthcoming
Posted: 13 Jul 2015
Date Written: May 3, 2015
While increased financial literacy may improve individual retirement savings decisions, modifying the placement of key information in retirement savings statements can produce further improvements. We examined the extent to which placement of information and financial literacy affected the accessibility of information for individuals and assisted in their financial decision making. We also disaggregated financial literacy into numeracy and knowledge to identify key drivers. Using an experimental design, we find the increased salience resulting from modifying the presentation format improved participants’ ability to locate important information (accessibility) and to evaluate the relative performance of funds (assessability). However, the incremental benefits of placement are only found for individuals with moderate numeracy skills. We conclude there is value accruing from financial literacy programs as advocated by regulators, but suggest additional benefits may be reaped from focusing on numeracy skills and from using presentation formats that improve information accessibility and assessability.
Keywords: Salience, presentation format, financial literacy, decision making, retirement savings statements
JEL Classification: D14, G11, G23, G28
Suggested Citation: Suggested Citation