Tailored messages and savings
Can specific nudges change savings behavior?
A relatively new area of research in behavioral economics is analyzing how specific nudges can change savings behavior. In one study, participants opened a savings account with a predetermined savings goal.
One group received an encouraging text message each month while the control group received nothing. The results showed that participants who received reminders were more likely to reach their savings goals. Additionally, reminders that made explicit reference to the individuals’ specific goals were twice as likely to be effective compared to reminders that were not personalized.