Association for Public Policy Analysis & Management

About 30 percent of DOL’s federal employees do not participate in or contribute less than 5 percent to their Thrift Savings Plan (TSP)—a retirement savings plan similar to 401K plans offered in the private sector. This is of concern to the Employee Benefits Security Administration (EBSA) at DOL because it means that these employees are not taking full advantage of the available employer match. To try to address this issue, EBSA partnered with a team of behavioral science and research experts to test the effectiveness of a simple, carefully tailored email message to these individuals. The email was designed to encourage these DOL employees to increase their contributions to TSP and take full advantage of the available employer match. The message built on retirement planning resources available to federal employees and drew on findings from behavioral research to address mental barriers that may prevent individuals from saving for retirement.

This paper and presentation will share the design and findings of a randomized controlled trial that tested whether this tailored email influenced employees’ retirement savings behavior. Emails were sent in September 2015 to half of a group of 4,078 DOL employees. These employees were either not currently participating in TSP or were contributing less than the 5 percent required to obtain the maximum employer match. The message’s effect on TSP savings was measured using DOL records of retirement contributions two months after the email was sent. Key findings from the trial included that: (1) a simple email message can influence employees’ savings decisions in a measurable way; (2) the message was more influential among those already contributing to TSP; (3) similar messages may have stronger effects among younger people; and (4) further refinements in message design or use might improve its effectiveness.