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How Can Customized Information Change Financial Plans?

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Publication Date: March 2011

Publisher(s): Center for Retirement Research at Boston College

Author(s): Norma Coe; Kelly Haverstick


Special Collection:

Topic: Economics (Consumers and consumption)
Economics (Property and wealth)

Keywords: savings and consumption; work and retirement

Type: Report

Coverage: United States


Many workers nearing retirement experienced a
dramatic decrease in their retirement assets when
the stock market crashed in 2008. In order to maintain
their expected standard of living in retirement,
workers needed to work longer, save more, or do
both. To measure the response of older workers to
this downturn, the Center for Retirement Research at
Boston College (CRR) fielded the CRR 2009 Retirement
Survey on a nationally representative sample of
45-59-year-old labor force participants with relatively
high pre-downturn assets.

This brief is the final in a series of four based
on the CRR 2009 Retirement Survey. The first brief
described the Survey and highlighted the inclusion of
numerous financial, employment, and behavioral factors
that are omitted from other surveys. The second
brief explored the relationship between these factors
and worker responses to the downturn. The third
brief examined how worker responses were affected
when their options were made explicit – work longer,
save more, or live on less in retirement. This brief
explores how respondents reacted once they received
information tailored to their specific situation.
This brief is organized as follows. The first section
provides an overview of the workers’ initial responses –
work more, save more, both, or neither. The second
section describes how these stated responses changed
after respondents received “expert advice” that quantified
the trade-off based on their specific circumstances.

The third section looks at the characteristics
of responders who remained committed to taking no
action even after the expert advice. The fourth section
assesses whether the expert advice led certain respondents
to better calibrate their plans. The final section
concludes that providing tailored financial advice may
help some individuals improve their response to an
adverse financial development.