How do behavioral approaches to increase savings compare? Evidence from multiple interventions in the U.S. Army

March 2021

Behavioral researchers have explored a variety of potential “nudges” designed to increase retirement savings. But selecting from among different approaches can be surprisingly difficult.


Information provision, choice simplification, social messaging, active-choice frameworks, and automatic enrollment all can increase retirement savings. Gauging the relative efficacy of these approaches is challenging, however, because the supporting evidence usually derives from diverse populations over long periods. In this study, the authors leverage experimental and quasi-experimental variation in a constant setting, the U.S. military, to examine the relative efficacy and cost effectiveness of four leading retirement savings policy options.

Key Insights
Light touch interventions increase retirement savings rates by 0.2 – 0.7 percentage points (pp); active choice increases participation by 11 pp; and automatic enrollment increases participation by 37 pp.
Similar effects and effect sizes occur with respect to contribution rates and cumulative contributions.
Active choice programs are the most cost-effective method to generate new enrollments for small (n=25 employees), medium (n=750), and large firms (n=1000), while automatic enrollment is the most cost-effective program for very large firms.

The authors leverage two randomized field experiments and two natural experiments in settings with very similar conditions using the largest study samples to date (approximately n=29,000 to n=164,000) and high-quality administrative data.