finra

FINRA

 

For Release:
Contacts:

Thursday, February 22, 2007

Sarah Bohn (202) 728-8988
Nancy Condon (202) 728-8379

 



NASD Investor Ed Foundation Announces 2007 General Grant Program Focusing on Investment Behavior and Retirement Income Security

Washington, D.C. — Behavioral finance, the retirement income security of older Americans and new marketing and distribution channels for investor education will be the main areas of focus for the NASD Investor Education Foundation's 2007 General Grant Program.

To provide greater flexibility for applicants, the 2007 General Grant Program will have two cycles. In the first cycle, applicants submitting proposals postmarked on or before Monday, February 26, will be notified of grant decisions in July. For the second cycle, proposals must be submitted on or before Friday, August 10, and notifications will be made in late December. The NASD Foundation's grant programs are open to non-profit organizations, including public and private colleges and universities.

"Most of us assume that individuals consider all available information when making decisions, especially financial decisions," said NASD Foundation Chairman Mary L. Schapiro, who also serves as NASD's Chairman and CEO. "But there's a growing body of evidence that that's not always true - that social, emotional and other influences lead people to make unwise economic and investment decisions that affect their financial security. We want to pursue research in the area of 'behavioral finance' so we can better understand how those biases affect financial decision-making, and develop investor education materials and strategies that can overcome those biases."

The NASD Foundation's 2007 grant program priorities also recognize the increasing importance of educating older Americans about managing their finances in retirement, given that the retirement population will swell to an unprecedented 70 million or more individuals, many of whom will have to manage assets accumulated in 401(k)s and other defined contribution plans. Another priority area focuses on new and effective ways to market and distribute investor education so that large numbers of Americans receive the help they need.

Additional funding priorities are specified in the NASD Foundation's grant guidelines, available at www.nasdfoundation.org. The guidelines also specify eligibility requirements and general grant criteria. The NASD Foundation is particularly interested in funding projects that will benefit underserved investor groups identified by NASD's 2003 Investor Survey.

In coming months, the NASD Foundation will announce a request for proposals for an additional grant program, Improving Investor Protection, focusing on research and/or education projects designed to protect investors from fraud.

The NASD Foundation is also announcing nearly $3.4 million in grants approved under its 2006 General Grant Program. They include:

Improving the Financial Management of Intact and Divorcing Couples - $629,310 to the Association for Financial Counseling and Planning Education (AFCPE) of Columbus, OH, to deliver a six-part financial education program to members of four non-finance professional counseling associations dealing with relationship and divorce issues, enabling them to assist clients with financial communications, budgeting and other financial management issues.

Nurses' Investor Education Project: Opportunities, Challenges and Moving Forward - $495,250 to the Women's Institute for a Secure Retirement (WISER) of Washington, DC, in partnership with the Center for American Nurses of Silver Spring, MD, to create a replicable investor education program for nurses.

Investing for the Future: Native Community Partnerships - $447,475 to the First Nations Development Institute of Longmont, CO, to develop an instructor guide and resource guide for trainers who provide investment education to Native American communities, building on the investor education curriculum produced with a 2004 grant from the NASD Foundation. In addition, First Nations will work with two Native American communities, conduct two national training events and create an InvestNative web portal.

Financial Reporting Simplification: Understanding Investor Decision-Making Behavior and Disclosure Preferences - $324,125 to the University of Central Florida (UCF) in Orlando, FL, to identify ways to enhance the usefulness and reduce the complexity of MD&A (management's discussion and analysis) and footnote disclosure in financial documents.

Guide to Dispute Resolution for the Small Investor - $153,725 to Pace University Law School in White Plains, NY, to develop and distribute an educational guide to help small, individual investors understand their legal rights and responsibilities in order to avoid disputes, or seek resolution through arbitration or mediation in the event of a dispute.

Grant agreements with three additional applicants are currently in process. The NASD Foundation has committed a total of $1.3 million for those projects. Also in 2006, the NASD Foundation launched a global financial education campaign specifically for U.S. military personnel and their families. The NASD Foundation's funding of the program exceeded $4.3 million in 2006. Another $3.8 million has been committed to the campaign in 2007.

The NASD Investor Education Foundation supports innovative research and educational projects that give investors the tools they need to better understand the markets and the basic principles of saving and investing. To date, the NASD Foundation has approved nearly $8.3 in grants and an additional $10.2 million in direct investor education programming. For details about grant programs and other NASD Foundation initiatives, visit www.nasdfoundation.org.