Do Income Projections Affect Retirement Saving?

Gopi Shah GodaColleen Flaherty Manchester Aaron Sojourner

IB#13-4

The brief’s key findings are:

  • One barrier to saving may be ignorance about how it translates into retirement income.
  • A recent study conducted a field experiment to see whether providing workers with retirement income projections affected the amount they saved.
  • The results show that such projections, accompanied by information on retirement planning, could modestly increase saving.
    • The experiment’s positive effect on saving works, in part, by boosting individuals’ knowledge and confidence.
    • But its effect on saving is limited among those with who have difficulty paying bills, prefer to “live for today,” or tend to procrastinate.