Before you scorn the use of badges, remember, the company match is the ultimate badge. If you meet a minimum savings goal, the company awards you a “badge” of a matching contribution.
Tag "loss aversion"
If it is true the fear of loss motivates people more than the offer of a gain, then the traditional 401k company match framework is designed improperly. Currently, employees are promised a reward for contributing in their 401k plan. Think of this as the carrot urging people to save for their retirement. What if, instead of using a carrot, plan sponsors reframe the “match” in terms of a stick?
FiduciaryNews Trending Topics for ERISA Plan Sponsors: Week Ending 5/9/14
RetirementCare coming soon? Fee Policy Statement coming soon? Behavioral smacks MPT.