Comments on FLEC Update to the US National Strategy for Financial Literacy

Gopi Shah Goda, Aaron Sojourner, and Colleen Manchester submitted comments to the Financial Literacy and Education Commission (FLEC) in response to its request for input on updating the National Strategy for Financial Literacy. Drawing on published research in behavioral economics, household finance, and retirement savings, the letter makes three main points:

1. Trump Accounts present a significant opportunity for experiential financial education at population scale, but realizing that potential requires deliberate design. The letter recommends that education providers use account statements and projection tools explicitly to address exponential growth bias—the widespread tendency to underestimate the power of compound interest—since research suggests that roughly 70 percent of the U.S. population systematically underestimates how savings grow over time. It also recommends that official government projections, including those on trumpaccounts.gov, provide balanced scenario ranges that account for inflation and taxes, and that information be delivered at high-leverage “teachable moments” such as tax filing and transitions out of child care.
2. The retirement savings literature offers a key insight the National Strategy should more fully reflect: choice architecture systematically shapes savings outcomes, often more powerfully than information provision alone. The letter recommends that the updated Strategy explicitly consider automatic enrollment, streamlined contribution pathways, automatic contribution escalation, and well-designed investment defaults as evidence-based best practices directly applicable to Trump Accounts and other savings programs.
3. Financial education and choice architecture are complementary strategies that reach different populations. Informational interventions can improve knowledge, but mainly among those with some baseline financial capability; structural design can have broader effects but must be carefully implemented. A revised National Strategy should encourage program designers to ask both what people need to know and how the decision environment can make good choices easier—and should build evaluation infrastructure into program design from the start.

Read the full comment letter