How much to save? Decision costs and retirement plan participation

• 成果类型: Article
• 署名作者: Goldin, Jacob; Homonoff, Tatiana; Patterson, Richard; Skimmyhorn, William
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2020.104247
• 发表日期: 2020
• 关键词: Retirement savings; complexity; Nudges; Decision costs; household finance

摘要

Deciding how much to save for retirement can be complicated. Drawing on a field experiment conducted with the Department of Defense, we study whether such complexity depresses participation in an employer-sponsored retirement saving plan. We find that simplifying one dimension of the enrollment decision, by highlighting a potential rate at which non-participants might contribute, increases participation in the plan. Similar communications that did not include a highlighted rate yield smaller effects. The results highlight how reducing complexity on the intensive margin of a decision (how much to contribute) can affect extensive margin behavior (whether to contribute at all) in a setting of policy interest. (c) 2020 Elsevier B.V. All rights reserved.