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Financial ServicesCommitment devicePositive

Save More Tomorrow (SMarT) Commitment Program

University of Chicago / Bernartzi & Thaler · United States · 2004

Summary

Save More Tomorrow is one of the most consequential behavioral economics experiments ever conducted. The core insight: present bias makes it painful to give up current income, but committing to give up future income feels almost costless. By anchoring the savings increase to pay raises — so workers never experienced a take-home pay reduction — Thaler and Benartzi transformed the savings rate from 3.5% to 13.6% over four years among participants. The experiment's impact far exceeded its original sample: the mechanism is now embedded in federal pension law and used by most major retirement plan administrators. It is the clearest example of a behavioral experiment producing policy change at scale.

Research question

"Can a commitment device — pre-committing to increase savings rate with future pay raises — overcome present bias and increase retirement savings?"

Methodology

Intervention

Workers at a mid-sized manufacturing company offered: (a) immediate savings rate increase recommended by financial advisor, or (b) SMarT plan — commit now to automatically increase savings rate by 3% at each future pay raise, with option to opt out; workers who declined the immediate increase were offered SMarT

Assignment

Field experiment with sequential design (not randomized; but comparison between immediate advice, SMarT, and advice refusers provides identification)

Sample size

315 employees across multiple cohorts

Primary outcome

Savings rate at enrollment; savings rate at 4-year follow-up; participation retention

Effect estimate

SMarT participants: savings rate increased from 3.5% to 13.6% over 4 years; immediate advice group: from 4.4% to 8.8%; advice refusers: 6.6% (no change). SMarT had 78% retention rate vs. 26% for immediate increase group.

Decision

SMarT mechanism incorporated into Pension Protection Act of 2006 (automatic escalation provisions); adopted by Vanguard, Fidelity, and most major 401(k) providers; standard feature of employer-sponsored retirement plans serving 50+ million workers

Result

Positive

SMarT participants: savings rate increased from 3.5% to 13.6% over 4 years; immediate advice group: from 4.4% to 8.8%; advice refusers: 6.6% (no change). SMarT had 78% retention rate vs. 26% for immediate increase group.

Evidence strength

Limited

Observational or pre-post design; correlation not necessarily causal.

Replication status

Replicated

Institution

University of Chicago / Bernartzi & Thaler

Location

United States

Year

2004

Policy area

Financial Services

Mechanism

Commitment device

More from these institutions

Other trials of this mechanism

Cite this entry

University of Chicago / Bernartzi & Thaler. (2004). Save More Tomorrow (SMarT) Commitment Program. The Experiment Society Registry. Retrieved from https://www.experimentsociety.org/registry/save-more-tomorrow (primary report: https://doi.org/10.1086/380085)

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Mentioned in the Dispatch

Issue 15 · June 19, 2026

The commitment device.

Why people voluntarily restrict their own future choices — and what it means for how we design public programs.

← Back to registryWhat the evidence shows →