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How to Get Young People to Save for Retirement

Using task complexity to prompt action on important, but non-urgent, tasks.

Key points

  • One in four employees do not take advantage of employer match opportunities on retirement savings, leaving billions of dollars unclaimed.
  • Presenting an important, non-urgent task as complex versus simple makes it feel urgent and initiates action, according to recent research.
  • People with little experience in the relevant domain are more likely to use task complexity as an urgency cue than experts, the research shows.
Photo by Karolina Grabowska from Pexels
Saving is urgent and important
Source: Photo by Karolina Grabowska from Pexels

America, we have a problem. The school year has come to a close and while many young people will begin their first new job, the majority of them will leave good money on the table.

One in four employees do not take advantage of employer match opportunities on retirement savings. How much money does the average worker leave on the table? An astounding $1,336, or 2.4 percent of salary annually, which adds up to a total of $24 billion dollars in unclaimed company matches[i].

It is well known that most new job market entrants will spend their income on the occasional splurge or to pay off current debt, but they will not put aside money to save for retirement. In the United States, 69 percent of millennials report not saving for retirement, which means they are not availing of the matching contributions that companies offer.

Why do people not avail of what has been dubbed “one of the best deals out there” [ii]? Because while saving for retirement is important, it does not feel urgent. Everyone has much more pressing concerns in the moment that they have to pay attention to, so addressing something that will matter in 40 years naturally takes the back seat.

Making a Task Look Complex Makes It Feel Urgent

How to get new job market entrants to get started by simply opening a retirement account is what is often described as a “wicked” design problem.

Photo by Karolina Grabowska from Pexels
Dealing with a "wicked" design problem
Source: Photo by Karolina Grabowska from Pexels

New research recently published in the Journal of Business Research, that I co-authored, presents one novel solution to initiating action on tasks that are important but do not feel urgent, like saving for retirement: Make the task look complex [iii].

We show that when an important but not urgent task is made to look complex, task complexity serves as a heuristic for urgency. In other words, when an important task is presented as being complex, it feels urgent and prompts immediate action. This insight is particularly relevant for novices in a domain who do not have the requisite knowledge to act with confidence and agency that experts have, and who tend to rely on heuristics in order to initiate action.

One study categorized individuals as novices or experts based on their responses to 15 questions on the MetLife financial literacy quiz[iv]. They were then randomly assigned to a high vs. low task complexity condition in which they were given instructions on how to set up a retirement account. Task complexity was manipulated via a number of steps. Pretests showed that presenting the same task in six steps was perceived to be more complex than when it was presented in two steps.

The study found that when novice investors (job market entrants, for instance) were given a more complex (six-step) task they felt greater urgency to act and were more likely to take action than those who were presented with a simpler (two-step) task. Experts, in contrast, focused on the importance of saving for retirement and chose to act, disregarding the task complexity heuristic. We replicated this finding in a variety of domains: saving for retirement, changing their passwords, signing up for extra credit, etc.

Two key takeaways of this research to remember:

  1. You don’t have to be financially secure to start saving; you have to start saving to be financially secure. One way to get novices to take action on the important task of saving for retirement is to make the task look complex so that it feels urgent.
  2. You can always find a way, using science and creativity, to design a wicked problem away.




[iii] Bayuk, Julia Belyavsky, and Vanessa M. Patrick. "Is the uphill road the one more taken? How task complexity prompts action on non-pressing tasks." Journal of Business Research 128 (2021): 436-449.