Nudging people into saving

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Last summer, with the support of Prudential, ILC-UK published a report which explored how we can use behavioural theories to encourage younger people to save. [1]

On Sunday, Baroness Greengross had a letter published in the Sunday Times (22 January) which highlighted one of our recommendations, i.e. if we are going to encourage more younger people into a savings habit, perhaps we should look to introducing a savings rule of thumb similar to the “five-a-day” healthy eating message.

Additionally, this week we heard that the new Chief Executive of the ABI is interested in another of our recommendations, i.e. the idea of greater pension flexibility (for example, allowing younger people to draw down their pensions when they need to). Saga have backed this call.

As a relevant aside, there is an interesting and recently posted TED lecture by Daniel Goldstein which talks about how we can nudge people to save. Take a look.

Perhaps they have all been reading the ILC-UK report?

David Sinclair

1. Resuscitating Retirement Saving http://www.ilcuk.org.uk/index.php/publications/publication_details/resuscitating_retirement_saving_how_to_help_todays_young_people_plan_for_la

One thought on “Nudging people into saving

  1. Robert Shields said:

    Will Hutton pointed out that if we all saved for annuities that would give a reasonable income on retirement the amount of savings would be greater than the value of the UK economy. Where precisely could these savings be invested? I am not saying that saving is bad but the consequnces need to be thought through

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