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VOL. 5, ISSUE 3 (2023)
Nudging towards savings: Behavioral interventions in financial decision-making
Authors
Dr. Sharmila Ahlawat
Abstract
This paper examines the efficacy of behavioral interventions designed
to increase personal savings rates across diverse demographic groups. Drawing
upon field experiments, randomized controlled trials, and longitudinal data
collected through 2022, we synthesize empirical evidence on the effectiveness
of various "nudges" in improving financial decision-making related to
savings. Our analysis identifies four key intervention categories with
measurable impacts: default option manipulation, commitment devices,
reminders/feedback mechanisms, and social norm messaging. Results indicate that
properly designed behavioral interventions can increase savings rates by 4-12
percentage points on average, with heterogeneous effects based on income
levels, age, and financial literacy. The paper concludes with policy
recommendations and considerations for the ethical implementation of behavioral
approaches in financial contexts
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Pages:98-103
How to cite this article:
Dr. Sharmila Ahlawat "Nudging towards savings: Behavioral interventions in financial decision-making". International Journal of Finance and Commerce, Vol 5, Issue 3, 2023, Pages 98-103
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