Active choice model and thrift savings enrollment

Loss Aversion and Financial Products
Intervention Financial Products

How active choice can change behavior.

Intervention Description

The federal government sought to increase the enrollment of military employees in the Thrift Savings Plan. This is the federal government defined contribution plan that will be an automatic enrollment process in 2018. The intervention used active choice to change behavior. At two different military bases, they had military employees choose between three options: I choose to enroll, I choose not to enroll, and I’m already enrolled. It was found that forcing a choice and making the decision less effort through this active choice model dramatically increased Thrift Savings Plan enrollment at these bases.