There's a second component of a good savings plan, which is something that a colleague of mine called Schlomo Benartzi and I developed many years ago, that we call "save more tomorrow."
Richard ThalerI think we also have learned the lesson that we have to have better incentive structures.
Richard ThalerRecall that people like to do what most people think it is right to do; recall too that people like to do what most people actually do.
Richard ThalerIf people just put away what's left at the end of the month, that's a recipe for failure.
Richard ThalerIn a typical 401k plan, when you first become eligible you get a big pile of forms and you're told, fill out these forms if you want to join. Tell us how much amount you've saved and how you want to invest the money. In, under automatic enrollment you get that same pile of forms but the top page says, if you don't fill out these forms, we're going to enroll you anyway and we're going to enroll you at this saving rate and in these investments.
Richard Thaler