Healthy, wealthy, wise? Is the tendency to save for retirement related to a tendency to improve one’s health? If I save more for retirement through my 401(k), am I more likely to respond actively and positively to news of negative health issues? In a study reported recently in Psychological Science, Tim Gubler and Lamar Pierce examined this question and its underlying mechanisms.
Gubler and Pierce noted that prior research has indicated that some people seek immediate gratification, immediate consumption, and forego planning for the future. Others save. We know this, that some people think short term; others, long term. These “time preferences” affect our activities, such as the risks we take. Gubler and Pierce wondered if people who saved for retirement and those who actively addressing negative health feedback had a common time orientation. There are potential implications here for organizational planning and leadership.
They studied several hundred workers from 2010 to 2012. About 75% of the employees contributed to their 401(k). Differences in annual company health screenings provided the data on changes in health. Gubler and Pierce found:
My take-aways:
1. My short review of Gubler and Pierce’s study does not do it justice. The study is highly sophisticated with appropriate statistical analyses and consideration of a variety of factors that could affect the results, such as conscientiousness. However, I think the implications for organizations, which they did not discuss, are significant.
2. The study clearly demonstrated that people who participate in their organizations savings plans "up their game" when faced with a need to improve health-related behaviors. This results of this study would suggest, all things being equal, that organizations with higher voluntary contributions to 401(k) plans should be healthier. Implication: Leaders should strongly encourage participation to company savings plans.
3. Another implication: The advantage of organizationally sponsored biometric screenings as part of an organization’s wellness program. But for the annual blood tests, employees may not have been aware of the need to change certain behaviors. In this study the health data was provided directly to the employees. The company only received the employee's health information if the employee so authorized.
4. Company benefits such as retirement savings plans and wellness programs benefit individuals but also potentially benefit organizations. This study suggested people who contribute to their retirement plans tend toward becoming healthier and have fewer sick days.
Gubler, T., & Pierce, L. (2014). Healthy, wealthy, and wise: Retirement planning predicts employee health improvements. Psychological Science, 25(9), 1822-1830.
"Evening No. 18". © John Ballard, 2014.
Gubler and Pierce noted that prior research has indicated that some people seek immediate gratification, immediate consumption, and forego planning for the future. Others save. We know this, that some people think short term; others, long term. These “time preferences” affect our activities, such as the risks we take. Gubler and Pierce wondered if people who saved for retirement and those who actively addressing negative health feedback had a common time orientation. There are potential implications here for organizational planning and leadership.
They studied several hundred workers from 2010 to 2012. About 75% of the employees contributed to their 401(k). Differences in annual company health screenings provided the data on changes in health. Gubler and Pierce found:
- “retirement savings and health-improvement behaviors were highly correlated” (p. 1823).
- When given information indicating a need for more healthy behaviors, individuals who were 401(k) contributors improved their health significantly more than similar individuals who were not 401(k) contributors.
- “psychological factors that are linked to retirement planning also predict health-improvement behaviors” (p. 1828).
- The number of sick days “was dramatically lower for contributors than noncontributors” (p. 1827)
My take-aways:
1. My short review of Gubler and Pierce’s study does not do it justice. The study is highly sophisticated with appropriate statistical analyses and consideration of a variety of factors that could affect the results, such as conscientiousness. However, I think the implications for organizations, which they did not discuss, are significant.
2. The study clearly demonstrated that people who participate in their organizations savings plans "up their game" when faced with a need to improve health-related behaviors. This results of this study would suggest, all things being equal, that organizations with higher voluntary contributions to 401(k) plans should be healthier. Implication: Leaders should strongly encourage participation to company savings plans.
3. Another implication: The advantage of organizationally sponsored biometric screenings as part of an organization’s wellness program. But for the annual blood tests, employees may not have been aware of the need to change certain behaviors. In this study the health data was provided directly to the employees. The company only received the employee's health information if the employee so authorized.
4. Company benefits such as retirement savings plans and wellness programs benefit individuals but also potentially benefit organizations. This study suggested people who contribute to their retirement plans tend toward becoming healthier and have fewer sick days.
Gubler, T., & Pierce, L. (2014). Healthy, wealthy, and wise: Retirement planning predicts employee health improvements. Psychological Science, 25(9), 1822-1830.
"Evening No. 18". © John Ballard, 2014.
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