How defaults influence investment allocation of pension plan members (novel data set, N = 5.953)

Psychological inertia is best described as a general tendency towards inaction and because actions are always associated with some mental or physical effort, we prefer to avoid it and maintain the status-quo. Inertia is just one of the behavioral reasons millions all across the globe are still not saving for retirement and for the onesContinue reading How defaults influence investment allocation of pension plan members (novel data set, N = 5.953)

Houston, we have a problem – (un)readability of retirement plan documentation 

According to the article in July’s issue of The Journal of Superannuation Management, you needed a tertiary level education* to understand or accurately interpret documentation related to your retirement plan. Guess how many Australians have a tertiary level education? Only 1,2 % of adults, hence the title of the article, Houston, we have a problem. Continue reading “Houston, we have a problem – (un)readability of retirement plan documentation ”

The Dunning-Kruger effect and retirement saving

The first rule of the Dunning-Kruger club is, you don’t know that you’re a member of.   A Slovenian news portal ran a terrific article the other day that also featured an interview with professor David Dunning, who together with Justin Kruger discovered the behavioral bias known today as the Dunning-Kruger effect. The effect was describedContinue reading “The Dunning-Kruger effect and retirement saving”

Not great, not terrible – Slovenia’s second pension pillar (update for 2021)

Since the Slovenian ministry of labour just released fresh stats for the second pension pillar, this just calls for an updated article on the evolution of the second pension pillar represented by defined contribution retirement plans.  In December 2021 the number of employees saving in the second pension pillar in Slovenia reached a record 585.154Continue reading “Not great, not terrible – Slovenia’s second pension pillar (update for 2021)”

Ireland to introduce automatic enrolment in retirement plans

Ireland just published ambitious plans to introduce automatic enrolment (AE) in retirement plans from 2024 onwards and since I always back AE as the single most important policy that can help people save for retirement, it’s well worth to look at the details, which are quite interesting and some came with some surprise for me.Continue reading “Ireland to introduce automatic enrolment in retirement plans”

Mandatory lifetime income projections (case of Slovenian pension funds)

In many countries with developed defined contribution retirement plans, like the US, UK and Australia, the debate around the decumulation phase of retirement saving is taking centre stage, as an ever growing number of plan members are entering retirement and looking to convert their savings into an income stream.  End of the day, that wasContinue reading “Mandatory lifetime income projections (case of Slovenian pension funds)”

Lessons for retirement saving from the movie Don`t Look Up (Netflix)

End of December Adam McKay’s new movie Don’t Look Up was released on Netflix bringing to us a fun satire of the current state of our society. An acclaimed cast, including Leonardo DiCaprio, Jennifer Lawrence, Jonah Hill, Meryl Streep and Cate Blanchett, show us thru a satiric lens, how our society is totally oblivious toContinue reading “Lessons for retirement saving from the movie Don`t Look Up (Netflix)”

What a shocker – automatic enrolment in retirement plans works (How it started and how to make it better)

Automatic enrolment (AE) in retirement plans is far from a new idea, in fact it’s now more than two decades old, but I’m still surprised how many people in the industry (finance, insurance, retirement, …)  and also in the government, are not aware of how powerful it really is. Every time the debate in myContinue reading “What a shocker – automatic enrolment in retirement plans works (How it started and how to make it better)”

The forever young ideology does not help retirement saving – what to do?

While vacationing I try to catch up on my reading (as much as family life allows), and once in a while to take a break from more serious reading, I browse over my wife`s “lifestyle” magazines that she usually reads on the beach. Scanning over them this year, what struck me was how many articlesContinue reading “The forever young ideology does not help retirement saving – what to do?”

Assets and members of Slovenia’s second pension pillar on the up, coverage rates are down

End of 2020 the number of employees saving in the second pension pillar in Slovenia reached a record 574.219 members. This means the coverage rate is roughly 60 % of all persons in employment, which is a fairly decent rate for a 20 year old voluntary system, but if we correct the number and deductContinue reading “Assets and members of Slovenia’s second pension pillar on the up, coverage rates are down”