Assessing demand for smart, automatic savings

Savings prefences
Experiment Type
Field Experiment
Increase program enrollment
Increase short-term savings
Focus Areas
Behavioral Concepts
Default bias
Partner Type

What Happened

There was no intervention. This study tested the popularity of different savings options. While there was no intervention, this study found that the most popular options, in order, was: 1) Manual Saving, 2) "Save on Payday", 3) "Approving Savings", 4) "Save off the Top".

Lessons Learned

This study found that the majority of users that were tested wanted some type of "smarter" atuomatic savings option. While the most commonly choser answer was the traditional manual option, "Save on Payday" was the second most common. This means beyond the default manual savings proess, users had a preference for automatic transfers on payday. Beyond this, there was a small but signifcant negative correlation between people who preferred manual savings and total deposit amount.


A system where individuals are defaulted to automatically set aside some of their paycheck has been an effective way to get people to save for retirement. In one study, opting new workers into a retirement plan increased the number of employees contributing to their retirement plans from approximately 60% to well over 95%. Surprisingly, we have yet to see this same default savings mechanism applied to short-term saving, despite how few people are consistently saving.

In an effort to explore how we might encourage people to set up automatic transfers to build savings, we partnered with the fintech company Narmi. Narmi provides clean and easy to use white label user interfaces for credit unions and banks of all sizes.

Key Insights

This partnership builds off of our previous work investigating why people are hesitant to adopt automatic transfers. That previous work highlights two barriers that discourage people from setting up automatic transfers:

  • People fear overdraft fees. When people are asked to set up automatic transfers, they feel they are sacrificing some degree of control.

  • People actually prefer ease and automation, as long as they don’t think they will be taken advantage of. In a previous experiment with Payable, we found that people are concerned about maintaining control, but they also prefer ease and automation when it comes to difficult or arduous tasks like tax preparation.


With these two insights in mind, we worked with Narmi to design potential savings products that would both default users into saving for the short term and decrease their concern with automatic savings tools. We hypothesized that if we were able to mitigate the fear of overdrafting, people would be more likely to adopt automatic savings plans.

In order to test whether customers will realistically sign up for a new feature, we designed a pilot to test demand for different types of automatic savings plans. We offered 124 Narmi users the chance to enroll in the new savings product. To measure how people actually behave, users were notified that their selection was under development for the future, if they chose to enroll.

The pilot offered users four potential savings strategies. Each was chosen because we hypothesized they may mitigate the fear of automatic savings.

  • Users could opt to “save on payday,” where a transfer would only be initiated the day that income was deposited into the account.

  • Users could “save off the top,” where a transfer would only be initiated when a threshold was met (i.e. Only save when there is $500 in the checking account).

  • Users could sign up for automatic transfers and “approve the transfer before they happen,” where users would be sent a notification before a transfer was initiated and they could approve or deny it.

  • Users could sign up for “manual transfers”, the traditional option offered by all banks.


While the most commonly chosen answer was the traditional manual option, results also indicate that the majority of users wanted some type of “smarter” automatic savings option. Of these options, “Save on Payday” was the most popular. “Approving Savings” and “Save Off The Top” were selected at relatively similar rates.

Narmi also provided data on users savings rates and deposit amounts. We observed a small but significant negative correlation between people who preferred manual savings and total deposit amount. People who had lower deposit balances were more likely to select the “manual savings” option. While correlational, these observations are in line with previous findings that suggest lower-net-worth users may be more reluctant to use automatic savings tools.

We plan to continue working with Narmi going forward to launch an experiment with new credit unions or banks that encourages users to save more money using automatic transfers in a way that alleviates the fear of overdrafting. Based on our survey, we hypothesize that defaulting users into a program that automatically contributes money to a savings account on payday will increase savings rates and more people will opt-in to and stay in automatic savings plans.