This comment discusses Professor George Loewenstein"s paper "How Do People Make Decisions?" and relates it to how people make choices in retirement plans.
Dr. Warshawsky first summarizes the main points of Professor Loewenstein"s paper and indicates areas of agreement and disagreement. The bulk of the paper discusses the experience of TIAA-CREF as reflected in three areas where people in the educational sectors have choices in retirement plans: (1) among pension plan types, that is, between defined benefit and defined contribution plans, (2) among pension plan providers or companies, and (3) among investment accounts.
