The worst decision-maker available for the savings process is the human investor making real-time choices about how to allocate each dollar of income as it arrives. Real-time financial decision-making occurs in exactly the conditions—full awareness of current spending opportunities, recency bias toward recent spending patterns, susceptibility to present bias—that produce the worst outcomes. Automating savings does not improve the quality of the investor's judgment; it removes the investor's judgment from the process entirely, replacing it with a rule that was established under better conditions and that executes consistently regardless of the momentary conditions that would otherwise distort it.

This is not an indictment of the investor's character or intelligence. It is an accurate description of the conditions under which saving decisions are made and the predictable ways in which those conditions produce poor outcomes. The investor who is deciding, at the end of a month, whether to transfer money to savings is making the decision after weeks of spending, in a context where the account balance is lower than it was at the beginning of the month, and where the psychological resistance to parting with the remaining balance is highest. She is the worst version of herself as a savings decision-maker—not because she is a bad person but because the decision context has arrayed all available psychological biases against the savings choice.

The early behavioural economists who developed the Save More Tomorrow programme demonstrated this empirically. The programme asked employees not to save more immediately but to commit to directing a fraction of future salary increases to savings—a commitment made in the present, to take effect in the future. The programme dramatically increased savings rates among participants, not because it changed anything about the fundamental economics of saving but because it removed the present-bias from the savings decision. By committing to save from future income rather than current income, participants experienced no immediate reduction in their standard of living, and the automatic execution of the commitment bypassed the real-time spending psychology that would otherwise have absorbed the income.

The general principle extends beyond the Save More Tomorrow structure to any form of savings automation. The investor who establishes automatic transfers to investment accounts on the day of each paycheque has made a single decision—the decision to automate—that will execute correctly every subsequent month, regardless of the spending psychology that will operate on the remaining income. The single decision, made under relatively calm conditions with the long-run objective clearly in view, is a better savings decision-maker than the monthly improvisation that would otherwise occur.

The practical implication is that the investor should design her financial infrastructure to minimise the role of real-time judgment in savings decisions. Automatic contributions to retirement accounts, automatic transfers to investment accounts, and automatic investment of accumulated balances are all mechanisms that execute the savings process without requiring ongoing willpower or repeated decision-making. The investor who has implemented these mechanisms is not relying on her future self to make good savings decisions; she has made those decisions once, well, and automated their execution in a way that does not depend on the future self being better than she actually is.