Research and Statistics

Incentives to save for retirement: understanding, perceptions and behaviour: a literature review

by Roger Wicks and Sarah Horack

A report of research carried out by the Government and Public Sector Team at PricewaterhouseCoopers on behalf of the Department for Work and Pensions.

This paper reviews the literature on motivations, understanding, perceptions and behaviour relating to saving for retirement. It is published as a companion paper to the main report of the saving incentives work programme (DWP Research Report No. 558). While the main report presents the evidence on quantifiable financial incentives to save for retirement, this literature review considers the available evidence on how people view and respond to these incentives.

The review summarises the theory behind financial incentives to save but points to evidence that many people do not save despite ‘income’ and ‘price’ motives. The reasons for this outcome are grouped under informational, structural and behavioural barriers. The review then outlines measures that may help some people overcome these barriers.

February 2009 62 pages 297x210mm

ISBN 978-1-84712-491-3