Nudging Retirement Savings: A Field Experiment on Supplemental Plans

Working Paper No. 23679 Although supplemental saving plans can be an important part of an individual's financial security in retirement, contribution rates remain low, particularly among those with lower salaries and less education. We report findings from a field experiment that distributed an...

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Bibliographic Details
Published in:NBER Working Paper Series 2017-08, p.23679
Main Authors: Clark, Robert L, Hammond, Robert G, Melinda Sandler Morrill, Khalaf, Christelle
Format: Article
Language:English
Subjects:
Behavior
Compound interest
Cost control
Cost of living adjustments
Design
Economic theory
Economics
Employees
Experiments
Financial literacy
Intervention
Older workers
Participation
Pension plans
Retirement income
Retirement planning
Retirement plans
Savings
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Summary:Working Paper No. 23679 Although supplemental saving plans can be an important part of an individual's financial security in retirement, contribution rates remain low, particularly among those with lower salaries and less education. We report findings from a field experiment that distributed an informational nudge containing information on key aspects of the employer-provided supplemental saving plans of older public employees in North Carolina. Among workers participating in a supplemental plan, individuals who received an informational nudge increased their contributions in the months following the intervention relative to the control group. Moreover, those that received the nudge reported in a subsequent survey that they were more likely to have developed a retirement plan and report more confidence in their retirement preparedness. In contrast, individuals who were not enrolled in a retirement saving plan were not moved to begin contributing to a supplemental plan.
ISSN:0898-2937
DOI:10.3386/w23679