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Tax-Sheltered Retirement Accounts: Can Financial Education Improve Decisions?

M. Martin Boyer (), Philippe d'Astous and Pierre-Carl Michaud ()

No 26128, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We conduct a stated-choice experiment to analyze the decision to contribute to front- or back-loaded tax-sheltered savings accounts. Our experimental design includes a randomized financial education treatment that provides information on these accounts. We assess whether respondents learn about the tax implications of these accounts and make contribution choices that increase after-tax income when exposed to the intervention. We find that our intervention improves both the understanding of the tax implications of the savings accounts (an increase of 6 to 15 percent) and contribution decisions. We find effects on after-tax lifetime-income for respondents by up to $1,900 per scenario presented.

JEL-codes: D14 G11 H31 (search for similar items in EconPapers)
Date: 2019-07
New Economics Papers: this item is included in nep-acc, nep-exp and nep-fle
Note: AG
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Working Paper: Tax-Sheltered Retirement Accounts: Can Financial Education Improve Decisions? (2019) Downloads
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