A new interactive "nutrition label" program is designed to help people invest wisely.

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Investing, whether in stocks or retirement funds, is a complex process, in which the vast majority of consumers are significantly undereducated in the skills needed to invest properly. Investors often pay too much and don’t get enough out of the process, which is why the United States has a “serious problem of underfunded retirement accounts,” one which results in retirement coming with significant decreases in standards of living because people don’t have enough put away.

One way of reducing the complexity and risks of investment is by giving consumers more information. That’s why researchers at the New York University Tandon School of Engineering have developed an interactive “nutritional label” for financial products. The label is pretty much what it sounds like: a system for providing information clearly that helps people make informed investment decisions. It even looks like the kind of labels you find on your food.

“The impetus for taking the nutrition label approach is the need to help people make sense quickly and effortlessly, taking into account future implications of possible actions they make now,” said Junius Gunartne, a doctoral student at the Tandon School and co-creator of the interactive label.

By making the label interactive, the researchers were able to make it even more useful, with subjects using the interactive version “54 percent more likely to reach their [investment] goal than those in the control group.” Test subjects, 450 if them, were tasked with generating $1.5 million over 35 years, with $10,000 per year to invest, all in simulation of course. They were given a variety of investment options and used the label to figure out what the best options were.

Such a label could be a huge boon both to consumers and the economy overall. Better-invested retirees are not only better able to care for themselves, keeping them out of hospitals or elder care for longer, but are also able to spend more. People who don’t have money to spare after bills aren’t able to contribute much to the economy, so helping more people have more money is in everybody’s interest.