Many workers nearing retirement experienced a dramatic decrease in their retirement assets when the stock market crashed in 2008. In order to maintain their expected standard of living in retirement, workers needed to work longer, save more, or do both. To measure the response of older workers to this downturn, the Center for Retirement Research at Boston College (CRR) fielded the CRR 2009 Retirement Survey on a nationally representative sample of 45-59-year-old labor force participants with relatively high pre-downturn assets. This brief is the final in a series of four based on the CRR 2009 Retirement Survey. The first brief described the Survey and highlighted the inclusion of numerous financial, employment, and behavioral factors that are omitted from other surveys. The second brief explored the relationship between these factors and worker responses to the downturn. The third brief examined how worker responses were affected when their options were made explicit – work longer, save more, or live on less in retirement. This brief explores how respondents reacted once they received information tailored to their specific situation. This brief is organized as follows. The first section provides an overview of the workers’ initial responses – work more, save more, both, or neither. The second section describes how these stated responses changed after respondents received “expert advice” that quantified the trade-off based on their specific circumstances. The third section looks at the characteristics of responders who remained committed to taking no action even after the expert advice. The fourth section assesses whether the expert advice led certain respondents to better calibrate their plans. The final section concludes that providing tailored financial advice may help some individuals improve their response to an adverse financial development.

Kelly Haverstick

Norma B. Coe

English

Research Papers in Economics

March 2011, Number 11-4
HOW CAN CUSTOMIZED INFORMATION 
CHANGE FINANCIAL PLANS? 
By Norma B. Coe and Kelly Haverstick*
* Norma B. Coe is associate director for research at the Center for Retirement Research at Boston College (CRR).  Kelly 
Haverstick is a research economist at the CRR.
Introduction 
Many workers nearing retirement experienced a 
dramatic decrease in their retirement assets when 
the stock market crashed in 2008.  In order to main-
tain their expected standard of living in retirement, 
workers needed to work longer, save more, or do 
both.  To measure the response of older workers to 
this downturn, the Center for Retirement Research at
Boston College (CRR) fielded the CRR 2009 Retire-
ment Survey on a nationally representative sample of 
45-59-year-old labor force participants with relatively 
high pre-downturn assets.1    
 
This brief is the final in a series of four based 
on the CRR 2009 Retirement Survey.  The first brief 
described the Survey and highlighted the inclusion of 
numerous financial, employment, and behavioral fac-
tors that are omitted from other surveys.2  The second 
brief explored the relationship between these factors 
and worker responses to the downturn.3  The third 
brief examined how worker responses were affected 
when their options were made explicit – work longer, 
save more, or live on less in retirement.4  This brief 
explores how respondents reacted once they received 
information tailored to their specific situation.      
This brief is organized as follows.  The first section 
provides an overview of the workers’ initial responses – 
work more, save more, both, or neither.  The second 
section describes how these stated responses changed 
after respondents received “expert advice” that quanti-
fied the trade-off based on their specific circum-
stances.  The third section looks at the characteristics 
of responders who remained committed to taking no 
action even after the expert advice.  The fourth section 
assesses whether the expert advice led certain respon-
dents to better calibrate their plans.  The final section 
concludes that providing tailored financial advice may 
help some individuals improve their response to an 
adverse financial development.
How Did Respondents React 
Initially?
This analysis is for a sub-sample of the full survey: 
those individuals who had accumulated at least 
$50,000 in retirement savings before the downturn 
and had lost at least 10 percent of retirement  Center for Retirement Research 2
assets at the time of the interview.5  Figure 1 shows 
the distribution of initial responses for this group.  
The initial responses to the downturn of these respon-
dents are similar to those of the full sample, with 
a substantial 43 percent intending to neither work 
longer nor save more.
Figure 1. Responses Before Advice
Save more only, 8%
Work longer and 
save more, 9%
Work longer 
only, 40%
Neither work 
longer nor save 
more, 43%
Source: Authors’ calculations from Center for Retirement 
Research at Boston College, CRR 2009 Retirement Survey.
Intended Actions After  
Receiving Customized Advice 
One of the unique features of the 2009 CRR Retire-
ment Survey is the administration of two distinct 
information “treatments.”  In the first treatment, the 
trade-off between working, saving, and decreased 
retirement consumption was made explicit, and how 
this information impacted one’s stated intentions 
was explored in Coe and Haverstick (2010b).  Later, 
the questionnaire introduced a “finance professor” 
to quantify the trade-off for each respondent.  For 
example, for a respondent who anticipated 25 to 40 
percent dependence on assets for retirement income, 
had adequate pre-downturn assets, and was at least 12 
years from retirement, the set of responses provided 
was: “save an additional 5 percent of earnings”; “retire 
about one year later”; or “have about 7 percent less 
income in retirement.”
After receiving the quantified trade-off informa-
tion, respondents then indicated whether they intend-
ed to change their saving, work, or retirement income 
plans relative to their initial response.  The distribu-
tion of the change in saving and working responses 
for this sample is shown in Figure 2.  Interestingly, 
Save more, 22%
Figure 2. Change in Responses after Advice6
Work longer and 
save more, 12%
Work longer, 10%
No change, 33%
Work less, 23%
Source: Authors’ calculations from CRR 2009 Retirement 
Survey.  
one-third of the sample indicated that the professor’s 
advice led to no change from their initial response.  
Second, another third stated that they now would 
save more to counteract the effects of the downturn, 
while over one-fifth of the respondents stated that 
they would work longer after receiving the professor’s 
advice.  Finally, almost one-quarter of the respondents 
said that they now intended to work less than before.  
It is important to assess whether the professor’s 
advice led to appropriate changes to the respondents’ 
initial plans.  Who are the respondents who are not 
influenced by the professor’s advice?  Who is plan-
ning to work even longer or save even more than 
their initial inclination?  And who intends to work 
fewer years?  Figure 3 on the next page shows how 
the professor’s advice changed individuals’ responses 
by the four categories of initial reactions.  The hope 
is that respondents who did not react to the profes-
sor’s advice are generally those who initially planned 
to take some action to counteract the downturn and, 
thus, are comfortable that their initial plan will be 
sufficient.  However, it turns out that the respondents 
mostly likely to ignore the professor’s advice are those 
who initially planned no action – nearly 40 percent of 
this group did not change their plans after the advice.  
Possible explanations for this unwavering attitude are 
explored in the following section.
Another interesting finding is the substantial 
proportion of those individuals initially planning to 
either “work longer only” or “work longer and save 
more” who were induced to decrease the number of 
additional years of work (47 and 34 percent, respec-
tively).  The pertinent question is whether these 
decreases are appropriate responses.  This topic is 
explored in a later section.Issue in Brief 3
Figure 3. Planned Responses After Advice, by 
Initial Response
Added work longer and save more    
100%
16%
34%
44% 75% 47%
50% 21%
31% 31%
25%
39% 31%
18%
0%
Neither work  Work   Save  Work  
longer nor   longer   more  longer and  
save more only only save more
Work less
Added save more Added work longer No change
1%
23%
4%
16%
1%
7%
8%
3%
24%
Source: Authors’ calculations from CRR 2009 Retirement 
Survey.
Can We Explain Committed 
Non-Responders? 
This section explores what characteristics are associ-
ated with being a “committed non-responder” – those 
individuals who persistently expressed no plans to 
work longer or save more.  These individuals may 
be less dependent on their retirement assets or have 
high expectations of future stock returns, so they 
feel no need to increase their savings or extend their 
work lives.  However, most of these characteristics 
are not statistically significantly different between the 
“initial non-responders” who reacted to the profes-
sor’s advice and those who did not.  In fact, these two 
groups differ in only two ways (see Figure 4).  First, 
the “committed non-responders” are older: 31 percent 
are ages 55-59, while only 10 percent of those indi-
viduals changing their plans to include some action 
are in this age range.  For these older respondents, 
the shorter time horizon until retirement makes the 
magnitude of the recommended actions that much 
greater.  For example, the average recommended 
saving rate increase is about 31 percent for the 55-59 
age group but only about 9 percent for the younger 
respondents.  Such a dramatic increase in saving may 
be simply infeasible for the older age group.  Working 
longer may also not seem feasible for someone close 
to retirement whose retirement plans are firmly in 
place.
Another characteristic that differs between these 
two groups is the adequacy of pre-downturn expected 
retirement income.  Almost 70 percent of “commit-
ted non-responders” had adequate retirement assets 
before the downturn, compared to only 40 percent 
of those who changed their plans in response to the 
professor’s advice.  This finding suggests that the 
“committed non-responders” were more likely to be 
on-track prior to the downturn and thus may feel 
more confident in their decision-making ability.  
10%
31%
69%
40%
Continue to take no action Take some action
80%
60%
40%
20%
0%
Ages 55-59
Adequate pre-downturn assets
Figure 4. Selected Characteristics of “Initial 
Non-Responders,” by Reaction to Advice 
Note: All mean proportions are statistically significantly dif-
ferent between the two groups. 
Source: Authors’ calculations from CRR 2009 Retirement 
Survey.
Did the Advice Help 
Curb Overreaction? 
Respondents who overreact to the financial downturn 
are also of concern, as they could wind up with less 
than optimal retirement outcomes.  According to the 
CRR calculations underlying the “professor’s advice,” 
respondents only had to work between six months 
and a year-and-a-half longer.7  However, many respon-
dents initially stated that they planned to work consid-
erably longer.  Figure 5 on the next page shows that 
most of the respondents who initially planned to work 
three or more years longer decreased their work plans 
to be more in line with the financial advice.8  For 
those who initially planned only one additional year 
of work and then lowered their retirement age based on the professor’s advice, most of them admitted that 
they expect to live on less in retirement because of 
this decrease.  Thus, this evidence suggests that the 
financial advice helped some respondents adjust their 
work responses to a more appropriate level.
Center for Retirement Research 4
Figure 5. Respondents Who Planned to Work Less 
after Advice, by Initial Work Response
22%
17%
73%
46%
1 year 
longer 
initially
2 years 
longer 
initially
3 years 
longer 
initially
4 or more years 
longer initially
80%
60%
0%
20%
40%
Source: Authors’ calculations from CRR 2009 Retirement 
Survey.
Conclusion
This brief explores the reactions of respondents who 
received tailored information about the trade-off 
between working longer, saving more, and decreased 
retirement income.  One-third of respondents did not 
change their initial plans while almost one-quarter re-
duced the number of additional years they planned to 
work.  In order to test how constructive the financial 
advice was, we examine how their responses changed 
relative to their initial response.  
Those who initially planned no response to the 
downturn were the least likely to change their mind 
after receiving the professor’s advice.  Further investi-
gation shows that these “committed non-responders” 
are older and more likely to have been on-track before 
the downturn.  Perhaps these individuals already have 
their plans in place, are close to retirement, and feel 
that they’ve made good prior decisions in preparing 
for retirement, so they are not swayed by additional 
advice.
 Almost all respondents who lowered their retire-
ment age after receiving the customized trade-off 
information had initially planned to work longer in 
response to the downturn.  Importantly, the advice 
seems to have decreased the planned working life 
for those who were overestimating the number of 
additional years of work needed to counteract their 
financial losses.  Thus, it seems that tailored finan-
cial information may help respondents make more 
reasonable plans.
 Issue in Brief 5
Endnotes
1  Information about the sample design and survey 
methodology is available in Munnell et al. (2010).
2  Sass, Monk, and Haverstick (2010).
3  Coe and Haverstick (2010a).
4  Coe and Haverstick (2010b).
5  This sample consists of 349 respondents with valid 
responses to the work longer and save more questions 
initially (q37_1, q31, and q32) and after receiving the 
quantified trade-off information (q3, q1, and q2).  For 
more information on the entire sample, see Coe and 
Haverstick (2010a).
6 The saving decision is based on the response to 
both saving questions – what they have done since 
the downturn and what they plan to do over the next 
12 months.  Respondents who answered “save more” 
for one question and “save less” for the other saving 
question were counted as not changing their saving.  
One percent of the sample planned to save less, but 
these respondents are included in the “work less” and 
“work longer” categories.
7 An extra year of work means three things: (1) an 
extra year of contributions and the associated invest-
ment returns; (2) an extra year of returns on existing 
assets; and (3) one less year of consumption out of 
retirement assets.  Combined, these factors make the 
number of additional years of work needed to recoup 
a financial loss relatively small.  See Sass, Monk, and 
Haverstick (2010) for more information.
8  The proportion of respondents initially planning 
to work at least four years longer who decreased their 
work plans is likely underestimated.  The initial work 
response is top-coded at four years, so we can only 
measure a decrease if a respondent changed to work-
ing three years longer or less.
References
Center for Retirement Research at Boston College. 
2009. 2009 Retirement Survey. Chestnut Hill, 
MA. Available at: http://crr.bc.edu/data_enclave/
crr_2009_retirement_survey_data.html.
Coe, Norma B. and Kelly Haverstick. 2010a. “How Do 
Responses to the Downturn Vary by Household 
Characteristics?” Issue in Brief 10-17. Chestnut 
Hill, MA: Center for Retirement Research at Bos-
ton College.
Coe, Norma B. and Kelly Haverstick. 2010b. “Re-
sponding to the Downturn: How Does Informa-
tion Change Behavior?” Issue in Brief 10-20. Chest-
nut Hill, MA: Center for Retirement Research at 
Boston College.
Munnell, Alicia H., Norma B. Coe, Kelly Haverstick, 
and Steven A. Sass. 2010. “Overview of the 2009 
CRR Retirement Survey.” Working Paper 2010-15. 
Chestnut Hill, MA: Center for Retirement Re-
search at Boston College.
Sass, Steven A., Courtney Monk, and Kelly Haver-
stick. 2010. “Workers’ Response to the Market 
Crash: Save More, Work More?” Issue in Brief 10-3. 
Chestnut Hill, MA: Center for Retirement Re-
search at Boston College.About the Center
The Center for Retirement Research at Boston 
College was established in 1998 through a grant from 
the Social Security Administration.  The Center’s 
mission is to produce first-class research and forge 
a strong link between the academic community and 
decision makers in the public and private sectors 
around an issue of critical importance to the nation’s 
future.  To achieve this mission, the Center sponsors 
a wide variety of research projects, transmits new 
findings to a broad audience, trains new scholars, and
broadens access to valuable data sources.  Since its 
inception, the Center has established a reputation as 
an authoritative source of information on all major 
aspects of the retirement income debate.
Affiliated Institutions
The Brookings Institution
Massachusetts Institute of Technology
Syracuse University
Urban Institute
Contact Information
Center for Retirement Research
Boston College
Hovey House
140 Commonwealth Avenue
Chestnut Hill, MA 02467-3808
Phone: (617) 552-1762
Fax: (617) 552-0191
E-mail: crr@bc.edu
Website: http://www.bc.edu/crr
© 2011, by Trustees of Boston College, Center for Retire-
ment Research.  All rights reserved.  Short sections of text, 
not to exceed two paragraphs, may be quoted without ex-
plicit permission provided that the authors are identified and 
full credit, including copyright notice, is given to Trustees of 
Boston College, Center for Retirement Research.
The research reported herein was performed pursuant to 
a grant from the U.S. Social Security Administration (SSA) 
funded as part of the Retirement Research Consortium.  The 
opinions and conclusions expressed are solely those of the 
authors and do not represent the opinions or policy of SSA, 
any agency of the federal government, or the Center for 
Retirement Research at Boston College.

How Can Customized Information Change Financial Plans?

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