This paper investigates two methods for improving participants’ asset allocations in their 401(k) plans: personalized online advice and managed account services. This paper uses a unique new dataset of individual-level administrative data from one 401(k) plan and recommendation data from an...

We examine equity portfolio choices of a panel of over four thousand 401(k) investors during the April 1994-August 1998 period. In the majority of participant/year observations all the equity funds available are held; hence, it appears that most participants take full advantage of the...

At three large firms offering 401(k) plans, we assess the impact of financial literacy and trust on 401(k) savings behavior in voluntary and automatic enrollment 401(k) plans. Financial literacy plays a critical role in improving 401(k) savings behavior — it reduces both the proportion of...

Australia’s retirement income system is regarded by some as among the best in the world. It has achieved high individual saving rates and broad coverage at reasonably low cost to the government. Australia’s system does have shortcomings. It is heavily dependent on defined contribution plans...

This paper investigates three common differences among DC plans that may lead to varying degrees of information overload. We hypothesize that information overload is one reason DC participants often choose the default options. In two experiments, we manipulate the display of the investment...

We study a new and unique data set of daily aggregate transfers of funds between mutual funds held in 401(k) accounts. We find that 401(k) transfers correlate strongly and positively with contemporaneous daily returns in the corresponding asset class. GMM estimation based on the...

As more and more public pension systems are shifting away from a defined benefit only framework, the complexity of the financial decisions facing public employees is increasing. This raises some concerns about the financial literacy of participants and their ability to make informed decisions....

The Handbook of Behavioral Finance is a comprehensive, topical and concise source of cutting-edge research on recent developments in behavioral finance.