TY  - GEN
AU  - Shu, Suzanne B.
AU  - Shu, Stephen D.
SN  - 2372-7322
AU  - Shu, Suzanne B.
AU  - Shu, Stephen D.
LA  - eng
CN  - ENP-f484d8fb-7655-4e28-83de-2ba3670c2cad
TI  - The psychology of decumulation decisions during retirement
PY  - 2018
AB  - The problem of drawing down one’s savings in retirement is known as decumulation and is a topic of growing policy importance. This article is devoted to understanding the psychology inherent in decumulation decisions and to identifying policy options that may develop from those findings. We begin by describing key psychological inputs to these decisions, including self-control, temporal discounting, loss aversion, fairness, and psychological ownership. We then briefly review the current evidence testing those processes within particular decumulation domains. Finally, we offer five possible policy approaches for influencing decumulation decisions, including addressing financial literacy, providing defaults, encouraging precommitments, offering disclosures, and building customized decision support systems. These interventions differ according to individuals’ financial sophistication and allow policy makers flexibility in determining the level of support to provide.
ER  -