Small Cues Change Savings Choices

James J. Choi, Emily Haisley, Jennifer Kurkoski, Cade Massey

NBER Working Paper No. 17843
Issued in February 2012
NBER Program(s):   AG   AP   PE

In randomized field experiments, we embedded one- to two-sentence anchoring, goal-setting, or savings threshold cues in emails to employees about their 401(k) savings plan. We find that anchors increase or decrease 401(k) contribution rates by up to 1.9% of income. A high savings goal example raises contribution rates by up to 2.2% of income. Highlighting a higher savings threshold in the match incentive structure raises contributions by up to 1.5% of income relative to highlighting the lower threshold. Highlighting the maximum possible contribution rate raises contribution rates by up to 2.9% of income among low savers.

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This paper was revised on June 29, 2012

Acknowledgments and Disclosures

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