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Investigations of Pennies, Percent, and Temporal Reframing to Improve Savings

Shu, S (2021). Investigations of Pennies, Percent, and Temporal Reframing to Improve Savings. (Unpublished Doctoral thesis, City, University of London)


It is not clear that people save enough, whether preparing decades in advance for retirement or preparing for nearer-term goals and needs such as rainy day accounts that can help with emergencies that come up. While there are multiple explanations for undersaving, people are not always adequately served by the financial and savings systems in place. Systems can make savings seem harder or more complex than it need be, and user interface designs may inadvertently discriminate against some people (or at least fail to help some people as much as they could). Through modest system modifications to current, incumbent savings processes, there may be opportunities to help certain subpopulations, such as those with lower income (e.g., demographic characteristics) or lower numeracy and lower financial literacy (e.g., individual behavioral differences). Note that a libertarian paternalistic perspective is one that seeks to do the most good for the most number of people while preserving freedom of choice. This thesis takes a libertarian paternalistic perspective in its investigation of methods that can potentially nudge better outcomes through changes to the behavioral architecture of savings. Chapters 1 and 2 represent a research stream that challenges the traditional notion of making retirement savings decisions in terms of percent of salary, which may discriminate against those who are less numerate, and instead investigates the notion of people making decisions using pennies for every dollar of salary they earn. Chapters 3 and 4 investigate temporally reframing savings decisions using per day, per week, or per month framing and elicitations. Insights from temporal reframing may be an important tool and approach for nonretirement savings contexts. The collection of investigations in this thesis comprises a holistic research approach by directly addressing both psychological judgments (through lab studies) and decisions and outcomes (through field studies).

Publication Type: Thesis (Doctoral)
Subjects: H Social Sciences > HG Finance
Departments: Bayes Business School > Finance
Doctoral Theses
Bayes Business School > Bayes Business School Doctoral Theses
[thumbnail of Shu Thesis 2021.pdf] Text - Accepted Version
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