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Behavioral Finance: One prominent example of a smart default is the Save More Tomorrow (SMarT) program. According to this program, retirement plan savers precommit to
Behavioral Finance: One prominent example of a smart default is the "Save More Tomorrow" (SMarT) program. According to this program, retirement plan savers precommit to future savings as a function of future raises until the savings rate reaches a pre-defined cap. Effectively, this ensures that take-home pay remains stable (or grows) even when employees increase their savings. Which behavioral bias(es) does this program exploit?
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