Pension Auto-Enrolment

Ireland's ageing society needs big initiatives to avoid a pension crunch in 10-15 years' time. This where the use of 'nudge' type 'choice architecture' comes in handy to get people contributing to their pensions.

We recently asked 1,000 adults whether they would approve or disapprove if, to prepare people for retirement, the Government requires that all employees who are not already in a pension scheme should be automatically enrolled in a pension scheme to which they contribute 5% of their salary every month, but employees can opt out if they wish.

The answer is clear enough - the vast majority would like to be nudged and those already retired are most in favour!

To put this in context, we asked people if they felt they have made adequate provision for your pension when you retire? The reality is that most haven't, including two thirds of those in the 45-54 age group:

KEY TAKEAWAY: there is a strong appetite for clear and specific pension interventions that encourage people to contribute to their pensions, by forcing them to opt out rather than opt in. The sooner the better perhaps.

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