Like many people, Jana wants to be sure she will have enough income when she retires, but doesn’t know how to plan for her retirement. She has heard about mutual funds and would like to invest in one, but isn’t sure how to select a fund that suits her needs. She has also been tempted by stories of high-yield investment successes. She wonders what the risks are. Jana openly admits she is intimidated by navigating the murky waters of investment planning and financial management—her education is limited, and math was never her strong subject.
EDC’s Adult Literacy Media Alliance (ALMA) recently received funding from the NASD Investor Education Foundation to address some of these issues through a project designed to increase money management skills and knowledge in low-literate adults. The project, called Save Smart, will produce a half-hour television program and accompanying curriculum aimed at adults with a 5th to 8th grade reading and math level.
The television program will be aired via an existing ALMA project, TV411, an Emmy award-winning, nationally broadcast television series that has received wide distribution through public television and cable stations since 1999. TV411 and its accompanying print materials and Web site have been created to reach a similar low-literacy audience. Save Smart will feature one of TV411’s popular “Calculating Woman” characters, Hyacinth, a math-savvy middle-aged Caribbean-American woman.
“While our target audience is adults with low literacy skills, the content of Save Smartis very relevant to people from all educational levels,” states Alex Quinn, ALMA’s executive director. “With television, you can appeal to a broad audience, attracting viewers regardless of their reading level. Moreover, the content we feature is relevant to many adults, as an increasing number of people are focusing on how to make their money grow for a sound financial future.”
Previous TV411 content has focused on financial literacy and basic consumer math skills, with segments on a range of topics from reading pay stubs accurately, to reading the fine print on credit card offers and understanding fees and finance charges, to understanding mortgage charts. The video segments developed for Save Smart will deepen this focus with key math concepts and investment-related vocabulary to help viewers manage their money and understand the math behind saving and investing.
In the first segment, Saving for Retirement, Hyacinth explains to a friend how to multiply projected Social Security benefits to calculate benefits upon retirement, how to estimate a percentage of income to set a retirement income goal, and how to interpret a graph depicting how compound interest increases savings over time.
Building on this segment, the characters delve deeper into retirement planning, demonstrating how investing in retirement accounts does not mean a decrease in income but rather getting more out of one’s money. Co-workers explore the meaning of “pre-tax dollars” by modeling how to find the percentage of taxes taken out of their pay check and comparing the reduction of income and taxes when they invest in a tax-deferred retirement account.
In another segment, characters track the rate of return on a mutual fund investment. In the final scenario, Hyacinth and her aunt model literacy skills in spotting potential costs in certain financial products. Together, they demonstrate the need to read the fine print, looking for charges and other “red flags” such as steep sales commissions, a high “surrender fee” and other hidden penalties that come with financial offerings.
“One of the key numeracy and literacy skills is understanding the fine print and asking questions if you are not clear about something. This seems so simple, but it is very important,” states Quinn. “This skill is modeled by the characters in the video segments so that viewers can see how to get their questions answered.”
In addition to its work in financial literacy, ALMA has developed several other multimedia (video, print, and web) curricula on topics such as health literacy, family literacy, and math basics. ALMA has trained thousands of teachers, administrators and community members at community-based organizations and state departments of education to use their materials in a wide variety of settings, including adult education centers, financial institutions, hospitals, prisons, and churches.
The Save Smart television program will be distributed to public television and cable stations throughout the country, including all the stations already airing TV411. Additionally, ALMA will engage in an outreach campaign to promote the program to state directors of adult education, national literacy groups, and other community-based organizations providing financial education. Programs requesting the Save Smart materials will be asked to contact their local public television station to encourage them to air the TV411 series. They will then be sent the DVD with all video segments, teacher guides, student handouts and links to interactive web lessons to accompany the video material.
Originally published on September 1, 2006