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Were you automatically enrolled in your 401(k) at work? Was it an opt-out plan? Are you a procrastinator?

Then you might want to consider the results of a research report recently published by the TIAA Institute. According to the authors of Mechanisms Behind Retirement Saving Behavior: Evidence from Administrative and Survey Data, people who tend to procrastinate are more likely to stay at the default contribution rate under automatic enrollment.

If, for instance, you were automatically enrolled in your employer-sponsored opt-out retirement plan with a default contribution rate of, say, 3%, then odds are high that you're still contributing only 3%.

The researchers say present bias is to blame. Present bias, according to, refers to the tendency of people to give stronger weight to payoffs that are closer to the present time when considering trade-offs between two future moments. In other words, those who exhibit present bias value the present more than the future. They would prefer to spend a $1 today rather than save it for some time in the future, say retirement.

"Present bias is a technical definition of the tendency for procrastination," says Gopi Shah Goda, a senior fellow and deputy director of the Stanford Institute for Economic Policy Research at Stanford University, a TIAA Institute Fellow and co-author of the research.

In their study, Goda and her colleagues found that those with present bias are more likely to not make "active choices" about contributions and more likely to not contribute the annual maximum to their retirement plan.

Steps You Can Take if You're a Procrastinator

OK, call it what you like. Are you a procrastinator, and unlikely to increase the amount you contribute to your 401(k) beyond the default?

"Knowing that you are a procrastinator is half the battle, as you can then take steps to mitigate it," says Goda.

One step you can take: "Set an annual reminder to check in on your progress towards your retirement goals is one potential way to ensure that you are taking the steps now to prepare yourself for retirement," says Goda. Not surprisingly, the researchers also found non-procrastinators on average save more than other employees and are more likely to maximize their employer match.

Financial Literacy Plays a Role

The researchers also discovered a link between financial literacy and something called exponential-growth bias (EGB) and how much you contribute to your 401(k). The more you know about such things as inflation, diversification, compound interest, mortgage payments and bond prices, the more likely you'll contribute the maximum allowed in your retirement plan.

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Indeed, the researchers found that low financial understanding increases the likelihood of you not saving at all if you're participating in an opt-in plan -- a plan where you must check the box to participate in a plan.

How can you easily get up to speed and kick-start your 401(k) plan? "Financial literacy is a broad concept, but even if you make the time to check in on your progress towards your goals, it can be difficult to understand the relationship between your current contributions and your future retirement income," says Goda. "Here, accessing retirement-income calculators that can provide you with this information can be helpful to understand whether you are on track."

Do What's Right for You

Other behavioral economists and experts say the study suggests that automatic enrollment is a mixed bag.

For example, George Loewenstein, a professor at Carnegie Mellon University (CMU), as well as co-director of the Center for Behavioral Decision Research at CMU and the director of behavioral economics at the Center for Health Incentives at the Leonard Davis Institute of the University of Pennsylvania, says that 13.3% of pre-automatic enrollment employees are contributing the annual maximum of $18,000 per year but only 6% of post-automatic enrollment employees are at this cap.

"This hints at the possibility that a bunch of employees who would have contributed at the maximum level without auto-enrollment, were lazy and went with the lower default with auto-enrollment," Loewenstein says. "But, pre-auto enrollment employees have been in the company longer, so that might account for the difference."

As for the time discounting, the exponential-growth bias, and the like, Loewenstein says it's difficult to know what's going on. "Working with observational, that is non-experimental, data is always challenging for the usual reason: correlation does not equal causation," he says.

Other experts also say the research proves automatic enrollment alone won't help plan participants reach their savings goals. "In our view, the findings of the study contribute to the mounting evidence showing the importance of going beyond automatic enrollment to produce meaningful and sustainable behavior change in relation to retirement savings," says Alain Samson, the chief science officer of Syntoniq, the founder of, and the editor of The Behavioral Economics Guide. "The interaction of present bias and financial literacy with choice architecture underscores the crucial role of traditional behavioral variables, such as education and engagement, to counteract inaction and foster a disciplined approach to retirement planning."

The research further highlights, says Samson, the inadequacy of one-size-fits-all behavior change techniques and the need for personalized approaches.

And that's an essential point: How to figure out what you need and what's right for your situation.

Start here:BankRate's Retirement Plan Calculator can show you how increasing your default savings rate can increase the size of your nest egg and reach your savings goal.

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