Investors who think investment returns are linear, rather than compounded, have less incentive to save money, according to the study.
Estimated reading time: 0 minutes, 22 seconds
Americans’ $1.7 Trillion Retirement Mistake
Present bias, or spending money now rather than saving, and failing to appreciate the power of compounded earnings has cost retirement savers $1.7 trillion.
That's equivalent to roughly 12% of the $14 trillion currently in individual retirement and 401(k) accounts, according to research from the National Bureau of Economic Research. So reports Bloomberg.
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