Heuristics and Biases in Retirement Savings Behavior

  title={Heuristics and Biases in Retirement Savings Behavior},
  author={Shlomo Benartzi and Richard H. Thaler},
  journal={RI: Retirement Decision-Making (Topic)},
  • S. Benartzi, R. Thaler
  • Published 22 January 2007
  • Economics, Business
  • RI: Retirement Decision-Making (Topic)
Standard economic theories of saving implicitly assume that households have the cognitive ability to solve the relevant optimization problem and the willpower to execute the optimal plan. Both of the implicit assumptions are suspect. Even among economists, few spend much time calculating a personal optimal savings rate. Instead, most people cope by adopting simple heuristics, or rules of thumb. In this paper, we investigate both the heuristics and the biases that emerge in the area of… 
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