NEW YORK-Fidelity Investments is playing with-and off-investors' emotions. And when it comes to retirement planning, more often than not, those emotions are negative.

"It takes too much time, it's too difficult, and it's not spontaneous at all," said Fidelity Chief Operating Officer Robert L. Reynolds during a presentation here last week. "We have to help people break through that inertia."

That inertia seems to be rooted in fear. In a Fidelity-commissioned survey of 1,511 working Americans conducted by Richard Day Research of Evanston, Ill., 82% of respondents said they enjoyed planning overall, and 74% described themselves as "planners." Yet when it came to planning for retirement, those statistics reversed. Only one in four respondents said they had actually drafted a plan, and less than one-third, 29%, considered themselves particularly good at financial planning.

That's especially dangerous as life expectancies continue to increase, heathcare costs creep upward, and the burden of saving for it all shifts to the individual.

"Hope is not a strategy," said Ellyn A. McColgan, president of Fidelity's brokerage division.

So Fidelity has come up with a strategy of its own: myPlan, a free, online program available to anyone, customer or not, designed to make retirement planning less painful-and perhaps increase inflows and drive new business the Boston-based behemoth's way.

Designed with the psychological barriers to saving in mind, myPlan is essentially a newer version of some of Fidelity's existing online tools, refined, repackaged and recast through a hefty upcoming Internet, television and print advertising campaign, McColgan said.

Fidelity is not the first financial services company to offer online calculators and diagnostics. Vanguard, Charles Schwab, T. Rowe Price, Nationwide and many others all offer similar tools. Where myPlan is different, Reynolds said, is its goal to "get people to change their behavior."

One element is "immediate gratification," said Shlomo Benartzi, a professor at the University of California at Los Angeles, and one of three behavioral economists Fidelity tapped to help tout the new myPlan campaign, although none were involved in its design.

Benartzi described an experiment he conducted where volunteers were asked what they wanted to eat at a meeting a week later: bananas or chocolate. The majority, 73%, elected the more responsible bananas. But when the appointed day arrived, participants were told that their initial responses had been lost and to just take whichever they wanted. More than 70% chose chocolate, illustrating a tendency for people to choose what is most immediately gratifying.

MyPlan addresses the need for instant gratification by providing online calculators that allow investors to plug in personal data and instantly see the projected effects on their retirement goals.

Brigitte Madrian, a professor at Harvard University's Kennedy School of Government, described people's propensity to avoid tasks that seem complex, unless faced with a deadline, or goal. MyPlan's "Snapshot" helps investors crystallize their goals by whittling down the questions they must answer to only five.

"It may be simple, but it's not simplistic," McColgan said. While customers see only five seemingly easy questions, what they don't see is the software running their responses through 250 simulations. The result is two projections: one assuming an exceedingly good market and another one where performance is not so hot.

From the snapshot, investors will be invited to conduct a 30-minute "Quick Check" diagnostic. Scheduled to go live next week, this is a refined version of the existing Fidelity Retirement Income Advantage (FRIA) program, which, Reynolds said, customers complained was too long and often quit before finishing.

Still, calculators are no cure-all said Don Cassidy, executive director of the Retirement Investing Institute in Denver. "Only [a certain percent] of investors will be satisfied with online calculators; the rest will want personal help," he said.

To answer that need, Fidelity invites those uncomfortable with the site to call a representative, or visit one face-to-face at an investor center.

The Quick Check tool tells investors how much more they need to save per month to meet their goals and recommends such strategies as opening an IRA or buying an annuity. Investors will be able to ask for suggestions for specific funds, creating either an all-Fidelity portfolio or an open architecture mix. In the future, Fidelity plans to include e-mail alerts to remind participants to rebalance, increase their work contributions or consolidate accounts.

Dan Ariely, a professor at the Massachusetts Institute of Technology, discussed how once investors make a decision, they tend to use it as the foundation for all others, no matter how arbitrary the starting point.

In his research, Ariely asked M.B.A. students whether they would buy certain things-such as bottles of wine, chocolates and trackballs-if the price were the same as the last two digits of their Social Security numbers. When asked whether they would still make the purchase if that price were doubled, those with low numbers typically said no.

That's because "opportunity cost" compounds the difficulty of making decisions about future goals, like retirement. A person may know what $1,000 can buy today, but be uncomfortable imagining how powerful that money may, if invested, be 20 or 40 years from now, he said.

In 2007, Fidelity plans to roll out the next phase of the myPlan, "Future Vision," which will include word association games and exercises to get investors thinking how they want to live in retirement and how they might accumulate the money to achieve those goals.

The one hurdle computer programs cannot clear is getting investors to take action once they have their plans in hand. Fidelity executives acknowledged that problem by emphasizing that these tools are a start, not necessarily a total solution, created for self-directed investors, and that there is, and always will be, an important place for professional financial planners.

"The most important thing is that people take the first step," McColgan said.

(c) 2006 Money Management Executive and SourceMedia, Inc. All Rights Reserved.

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