In Collaboration With:
Intuit is a business and financial software company that develops and sells financial, accounting and tax preparation software and related services for small businesses, accountants, and individuals.
Saving rates among low- and middle-income households tend to be low, but the benefits are high. We sought to understand which types of interventions can increase tax refunds to save as opposed to spend immediately.
We designed several interventions to encourage people to divert money from their refunds into savings accounts. To test which methods were most effective, we relied on two primary behavioral mechanisms: motivational prompts and suggested savings amounts (anchors). The motivational prompts encouraged TurboTax users to think of concrete reasons to save: an emergency, their family, or the future. This was compared with a generic prompt to save (the control). Anchors were implemented by recommending a savings level (as a percentage of the refund and/or a specified dollar amount) and pre-populating a web form with these different amounts: 25%, 50%, 75%, $100, or $250.
Value for Sponsor
Intuit has obtained knowledge that can substantially increase saving. While the increase between the two behavioral mechanisms appears modest, the translation to the number of new savers is substantial: 4,800 participants. Overall, the combined impact of these behavioral interventions increased the amount saved by roughly 6 million dollars.