You have been hired as a consultant by a company to develop the company's retirement plan, taking into account different types of predictably irrational behavior commonly displayed by employees. State at least two types of irrational behavior employees might display with regard to the retirement plan and the steps you would take to forestall such behavior.

Predictably irrational behavior refers to the fact that people often make decisions that are not in their best interest due to cognitive biases and emotions. In the context of retirement planning, employees might display the following irrational behaviors: 1. Procrastination: Employees might delay enrolling in the retirement plan or postponing making decisions about their plan, even though it would be financially beneficial for them to start saving as early as possible. 2. Loss aversion and risk aversion: Employees might be more focused on avoiding short-term losses than on maximizing their long-term gains, causing them to make overly conservative investment choices that do not provide enough growth potential for their retirement savings.

To address the issue of procrastination, the company can implement the following strategies: 1. Automatic enrollment: Enroll employees in the retirement plan by default, allowing them to opt out if they wish but making it easier for them to get started with the plan. 2. Simplified enrollment process: Make the enrollment process for the retirement plan simple and user-friendly, reducing the barriers for employees to join. 3. Reminders and nudges: Send regular reminders to encourage employees who have not enrolled in the plan to do so, and provide incentives (e.g., matching contributions) to encourage them to begin saving as soon as possible.

To tackle loss aversion and risk aversion in employee's investment choices, the company can implement the following strategies: 1. Education: Provide employees with educational materials and workshops on retirement planning, investment strategies, and risk management. This will help them better understand the potential benefits of taking on moderate risk in their investments. 2. Default investment options: Set up default investment options that are well-diversified and have an appropriate level of risk for the employee's age and time horizon, encouraging them to maintain a more balanced investment portfolio. 3. Regular portfolio reviews: Encourage employees to periodically review their investment choices and provide tools to help them assess the risk and performance of their portfolio, enabling them to make more informed decisions about their investments.