Consumer Finance: Mortgages, Credit Cards, Retirement 

Eric Johnson, Kellen Mrkva 

Every day, consumers have to make a variety of financial decisions, often complicated ones, with little to no training. Saving for retirement, choosing a credit card, and refinancing a mortgage are all complex decisions that can have substantial impacts on a consumer's financial health. When individuals are faced with such complex decisions, they often adopt mental shortcuts, or "heuristics" to make these decisions more easily.  Using heuristics, however, can lead to mistakes, causing individuals to make suboptimal decisions.  We want to examine the quality of decisions individuals make in these domains and document mistakes and their causes.  We also want to examine which characteristics of these decisions most influence the options that are eventually chosen.