Breaking Barriers in Retirement Planning: Evidence from Colombia’s Dual-Advisory Program

Oscar Becerra, Eduardo Cavallo and Carlos Santiago Guzmán Gutiérrez
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Eduardo Cavallo: Inter-American Development Bank
Carlos Santiago Guzmán Gutiérrez: University of Oxford

No 21365, Documentos CEDE from Universidad de los Andes, Facultad de Economía, CEDE

Abstract: This paper investigates the impact of behavioral frictions and information provision on retirement planning through the Dual Advisory program in Colombia. The program gradually became mandatory to prevent costly mistakes and offered personalized information on switching pension plans. Using a regression discontinuity design and administrative data, we estimate the causal effects of the program on switching behavior and contribution patterns. The findings indicate that the program reduced unfavorable switches by approximately 29.5%, due to a combination of deterring would-be switchers for whom the switch would have resulted in lower expected pension (22.7%) and the information received by those who attended the sessions (6.7%). However, the program also deterred favorable switches by 10.7%. There is no evidence of the program affecting contribution frequency post-intervention.

Keywords: Information provision; retirement planning; pensions; switching cost; inertia. (search for similar items in EconPapers)
JEL-codes: D14 G53 H55 I22 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2025-03-27
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Persistent link: https://EconPapers.repec.org/RePEc:col:000089:021365

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