TY  - JOUR
AU  - Beshears,John
AU  - Choi,James J.
AU  - Laibson,David
AU  - Madrian,Brigitte C.
TI  - Simplification and Saving
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 12659
PY  - 2006
Y2  - October 2006
UR  - http://www.nber.org/papers/w12659
L1  - http://www.nber.org/papers/w12659.pdf
N1  - Author contact info:
John Beshears
Stanford Graduate School of Business
655 Knight Way
Stanford, CA 94305-7298
Tel: 650/723-6792
E-Mail: beshears@stanford.edu

James J. Choi
Yale School of Management
135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
E-Mail: james.choi@yale.edu

David Laibson
Department of Economics
Littauer M-12
Harvard University
Cambridge, MA 02138
Tel: 617/496-3402
Fax: 617/495-8570
E-Mail: dlaibson@gmail.com

Brigitte C. Madrian
John F. Kennedy School of Government
Harvard University
79 JFK Street
Cambridge, MA 02138
Tel: 617-495-8917
Fax: 617-496-5960
E-Mail: Brigitte_Madrian@Harvard.edu
M2  - featured in NBER digest on 2007-05-01
AB  - The daunting complexity of important financial decisions can lead to procrastination. We evaluate a low-cost intervention that substantially simplifies the retirement savings plan participation decision. Individuals received an opportunity to enroll in a retirement savings plan at a pre-selected contribution rate and asset allocation, allowing them to collapse a multidimensional problem into a binary choice between the status quo and the pre-selected alternative. The intervention increases plan enrollment rates by 10 to 20 percentage points. We find that a similar intervention can be used to increase contribution rates among employees who are already participating in a savings plan.
ER  -