Project: Effects of Lifetime Income Disclosure on Retirement Saving



The trend away from defined benefit pension plans toward defined contribution plans has effectively transferred the responsibility of saving for retirement from the employer to the employee. Given the low level of financial knowledge of the American public, it is not surprising that people have difficulty understanding how much money they must accumulate in their working years to create a sufficient stream of income once they retire.


This project examines whether disclosing information about the monthly retirement income stream resulting from an individual's retirement account will change savings behavior.

The research uses an experiment to measure the effect of providing information that helps people understand the equivalence between defined contribution account balances and monthly retirement income streams on discretionary retirement saving behavior.

The results of our survey will help inform policymakers as to whether widespread dissemination of this type of information, as proposed in the pending Lifetime Income Disclosure Act, will lead to a higher level of financial security in retirement by improving individuals’ understanding of retirement income needs.

Research Team

Principal investigators: Gopi Shah Goda, Stanford; and Colleen Flaherty Manchester and Aaron Sojourner, University of Minnesota

In the Media

The Easiest Way to Get People to Save More, U.S. News and World Report, March 27, 2012