Using Vividness Interventions to Improve Financial Decision Making

Prior policy work has effectively eased some financial problems that Americans face: Automatic enrollment in retirement saving accounts has drastically increased the number of workers who participate in defined contribution retirement plans. Yet, such choice architecture interventions cannot always be implemented, and even when they can, they are beholden to whatever decisions the choice architect made and, in any case, may not go far enough in helping maximize financial well-being over time. Additional interventions thus need to complement already successful choice architecture ones. Namely, because many financial decisions involve trade-offs between present and future selves, with the present self often being prioritized, this review highlights interventions that make the future self more vivid to decision makers. We discuss the theoretical background underlying such interventions, the factors that may make vividness interventions more or less effective in policy contexts, and possible future directions for researchers and policy makers