Can Making Family Salient Increase Financial Savings? Quantifying Heterogeneous Treatment Effects in Voluntary Retirement Contributions Using a Field Experiment in Mexico

We use evidence from a large-scale field experiment in Mexico (N=97,149) to test the effectiveness of various behavioral interventions on voluntary retirements savings contributions. Specifically, we use SMS reminders to test whether previously successful behavioral interventions (e.g., basic alerts, pennies-a-day, fresh start, individual goal security) or a previously undocumented behavioral intervention-framing retirement savings as a way to 'secure your family's financial future'-influences contribution rates in comparison to those who did not receive a text. We found that a family security SMS intervention significantly increased voluntary contribution savings and was more effective than previously used interventions. Using recently developed machine-learning techniques to quantify the heterogeneity in the treatment, we found that women under the age of 29 were nearly 67% less likely to contribute when given this family intervention compared to no intervention at all, while individuals between 29-41 were 68% more likely to contribute, regardless of gender. The heterogeneity in the treatment effects has important managerial implications: We demonstrate that sending this intervention to all account holders would increase profits by $375,800 pesos ($19,032 USD). In contrast, a strategic application of this intervention to pro table individuals only would increase profits by $4,887,000 pesos ($246,000 USD). From a consumer welfare perspective, this strategic application would also generate 4,597 new voluntary retirement contributors (the blanket approach would generate 2,340 new contributors).